Covered Calls Established in Energy Select Sector SPDR Fund ETF

A Covered Calls position was established in the Energy Select Sector SPDR Fund ETF (ticker XLE), with a March 25th, 2022 options expiration date. Three hundred shares of the Energy Select Sector SPDR Fund were purchased at $72.02 and three Call options were sold at $3.66 per share at the $69.00 strike price.  

The time value was $.64 per share [$69.00 strike price - ($72.02 share price - $3.66 options premium)] when this buy/write limit order transaction was executed.  XLE also goes ex-distribution on March 21st, 2022.  The amount of this regular quarterly dividend has not been announced but in the calculations below, an estimate of $.62 per share which is assumed and is included in the return-on-investment result detailed below which is: +1.8% absolute return (equivalent to +60.7% annualized return-on-investment over the next 11 days) if the stock is assigned on the March 25th, 2022 options expiration date.  

The Delta was 74.6 when this position was established, which is the approximate probability that it will close in-the-money on the options expiration date.

Energy Select Sector SPDR Fund ETF (XLE) -- New Covered Calls Position
The buy/write transaction was as follows:
3/15/2022 Bought 300 shares of the Energy Select Sector SPDR Fund @ $72.02 per share 
3/15/2022 Sold 3 XLE March 25th, 2022 $69.00 Call options @ $3.66 per share
Note: the Implied Volatility of these Call options was 35.8 when this position was established.
3/21/2022 Ex-distribution estimated to be approximately $.62 per share
 

A possible overall performance result (including commissions) would be as follows:
Covered Calls Cost Basis: $20,510.01 = ($72.02 - $3.66) * 300 shares + $2.01 commission

Net Profit Components:
(a) Options Income: +$1,095.01
= ($3.66 * 300 shares) - $2.01 commissions
(b) Dividend Income (If XLE shares assigned at March 25th, 2022 options expiration): +$186.00
= ($.62 dividend per share x 300 shares)
(c) Capital Appreciation (If XLE shares assigned at $69.00 strike price at options expiration): -$906.00
= +($69.00 - $72.02) * 300 shares

Total Net Profit (If XLE shares assigned at $69.00 strike price at the March 25th, 2022 expiration): +$375.01

= (+$1,095.01 + $186.00 - $906.00)
 

Absolute Return-on-Investment (If XLE shares assigned at $69.00 strike price on March 25th, 2022 options expiration date): +1.8%

= +$375.01/$20,510.01

Annualized Return-on-Investment (If XLE shares assigned at $69.00 strike at March 25th, 2022 options expiration): +60.7%

= (+$375.01/$20,510.01) *(365/11 days)

These returns will be achieved as long as the stock is above the $69.00 strike price at assignment.  If the stock declines below the strike price, the breakeven price of $67.74 ($72.02 -$3.66 -$.62) provides 5.9% downside protection below today's purchase price.