February 25th, 2022 Options Expiration Results

Yesterday, the February 25th, 2022 (a Weekly options expiration date) Covered Calls position in Schlumberger Ltd. (ticker SLB) expired in-the-money, so the 500 Schlumberger shares were assigned (i.e. sold) at the $37.00 strike price.  As detailed below, the return-on-investment (ROI) result was  +1.3% absolute return (equivalent to +40.3% annualized return-on-investment for the 12 days holding period).

Schlumberger Ltd. (SLB) -- Covered Calls Position Closed Out by Assignment on the Options Expiration Date
The simultaneous buy/write transaction today was as follows:
2/14/2022 Bought 500 Schlumberger shares @ $39.25
2/14/2022 Sold 5 SLB 2/25/2022 $37.00 Call options @ $2.74
Note: the Implied Volatility of the Calls was 47.0 when this transaction was executed.
2/25/2022 The Schlumberger Feb. 25th, 2022 $37.00 Covered Calls position closed at expiration in-the-money (the stock price was $39.45), so the 5 SLB options expired and 500 Schlumberger shares were sold at the $37.00 strike price.

The overall performance results (including commissions) for this Covered Calls position were as follows:
Covered Calls Cost Basis: $18,258.35
= ($39.25 - $2.74) * 500 shares + $3.35 commissions

Net Profit Components:
(a) Options Income: +$1,366.65
= ($2.74 * 500 shares) - $3.35 commissions
(b) Dividend Income: $0.00
(c) Capital Appreciation (Schlumberger shares assigned at $37.00 strike price at options expiration): -$1,125.00
+($37.00 - $39.25) * 500 shares

Total Net Profit: +$241.65

= (+$1,366.65 options income + $0.00 dividend income - $1,125.00 capital appreciation)

 

Absolute Return-on-Investment: +1.3%

= +$241.65/$18,258.35

Annualized Return-on-Investment: +40.3%

= (+$241.65/$18,258.35) *(365/12 days)