Early Assignment of Covered Calls Position in Oracle Corporation

Early this morning I was notified by my broker's email that the two Oracle Corporation (ticker ORCL) October 20th, 2023 $102.00 Call options were exercised yesterday.  Oracle stock has increased from its purchase price of $105.50 on Tuesday last week when this Covered Calls position was established to $109.31 at the market close yesterday.  I am pleased for this early assignment despite losing the opportunity to capture today's $.40 ex-dividend since the +47.6% annualized-return-on-investment (aroi) achieved by early assignment is greater than the +30.9% aroi that would instead have been achieved if this position was instead assigned on its October 20th options expiration date.   

The post when this Oracle Corp. Covered Calls position was originally established is here.  As detailed below, the return-on-investment result for this Oracle Corporation Covered Calls position was +1.0% absolute return in 8 days (equivalent to a +47.6% annualized return-on-investment).  

Oracle Corporation (ORCL) -- Covered Calls Position Closed by Early Assignment

The buy/write transaction was:
10/3/2023 Bought 200 Oracle Corporation shares @ $105.50
10/3/2023 Sold 2 ORCL 10/20/2023 $102.00 Call options @ $4.56 per share
Note: the Implied Volatility of the Call options was 26.2 when this buy/write transaction was executed.
10/11/2023 Oracle Call options owner exercised their two Call options, so the Covered Calls position was closed out early. The two ORCL Call options expired worthless and the 200 Oracle Corp. shares were sold at the $102.00 strike price.

The overall performance results (including commissions) for this Covered Calls position are as follows:
Oracle Covered Calls Net Investment: $20,189.34
= ($105.50 - $4.56) * 200 shares + $1.34 commission

Net Profit Components:
(a) Options Income: +$910.66
= ($4.56 * 200 shares) - $1.34 commission
(b) Dividend Income (Calls exercised early on the last business day prior to the October 11th ex-div date): +$0.00
(c) Capital Appreciation (ORCL Call options assigned early on October 11th): -$700.00
+($102.00 strike price - $105.50 stock price) * 200 shares

Total Net Profit [Early exercise on the last business day prior to the Oct. 11th ex-dividend date)]: +$210.66

= (+$910.66 options income +$0.00 dividend income -$700.00 capital appreciation)

Absolute Return-on-Investment: +1.0%

= +$210.66/$20,189.34

Annualized Return-on-Investment: +47.6%

= (+$210.66/$20,189.34) * (365/8 days)