The post showing the details of this position when it was originally established is here . As detailed below, the return-on-investment results for this U.S. Bancorp was: +0.6% absolute
return in 7 days (equivalent to a +30.8% annualized
return-on-investment).
U.S. Bancorp (USB) -- Covered Calls Position Closed by Early Assignment
The original simultaneous buy/write transaction was:
12/22/2022 Bought 400 U.S. Bancorp shares @ $42.30
12/22/2022 Sold 4 USB January 6th, 2023 $41.00 Call options @ $1.54 per share. The Implied Volatility of these Call options was 21.4 when this position was established.
12/29/2022 U.S. Bancorp Call options owner exercised their options, so the Covered Calls position was closed out early. The 4 USB Call options expired worthless and the 400 BK shares were sold at the $41.00 strike price.
The overall performance results (including commissions) for this U.S. Bancorp Covered Calls position are as follows:
Stock Purchase Net Investment: $16,306.68
= ($42.30 - $1.54) * 400 shares + $2.68 commission
Net Profit:
(a) Options Income: +$616.32
= ($1.54 * 400 shares) - $2.68 commission
(b) Dividend Income (Four Call options exercised early on December 28th, the last business day prior to the December 29th ex-div date): +$0.00
(c) Capital Appreciation (USB's shares assigned early at $41.00 strike price): -$520.00
+($41.00-$42.30) * 400 shares
