During the final half-hour of trading yesterday afternoon, I decided to close out the Covered Calls positions in APA Corporation (ticker APA) and CVS Health Corporation (ticker CVS). Both positions had an expiration date yesterday of 1/26/2024 and both were priced out-of-the-money. For APA, the dividend was captured and I decided to move on to another dividend capture opportunity with a 2/16/2024 expiration date in the Energy sector rather than continue with this APA position. For CVS (owner of Aetna), the stock experienced a sharp price decline since I purchased it (largely in sympathy with the weak earnings reported by both Humana and United Healthcare), so I do not want to continue to hold CVS for that reason given that its quarterly earnings is upcoming on February 2nd. So, since I did not intend to continue with either of these positions, yesterday I closed out (i.e. unwound) both positions by selling the stocks and simultaneously buying-to-close their Call options.
The detailed transactions and return-on-investment results for both positions are provided below.
The simultaneous buy/write transactions was as follows:
1/5/2024 Bought 600 shares of APA Corporation stock @ $33.92 per share.
1/5/2024 Sold 6 APA January 26th, 2024 $33.00 Call options @ $1.55 per share.
1/19/2024 Ex-dividend at $.25 per share
1/26/2024 Unwound this Covered Calls position by selling 600 shares at $32.15 per share and simultaneously buying-to-close 6 Call options at $.01 per share -- for a net credit of $32.14 per share.
The overall performance results (including commissions) are as follows:
Covered Calls Net Investment: $19,426.02
= ($33.92 - $1.55) * 600 shares + $4.02 commission
Net Profit Components:
(a) Options Income: +$919.98
= ($1.55 - $.01) * 600 shares - $4.02 commission
(b) Dividend Income: +$150.00
= $.25 dividend per share x 600 shares
(c) Capital Appreciation (600 APA shares sold at $32.15): -$1,062.00
= ($32.15 stock sales price - $33.92 original purchase price per share) * 600 shares
Net Profit: +$7.98
= (+$919.98 options income +$150.00 dividend income - $1,062.00 capital appreciation)
Absolute Return-on-Investment: +0.04%
= +$7.98/$19,426.02
Equivalent Annualized Return-on-Investment: +0.7%
= (+$7.98/$19,426.02) * (365/21 days)
2. CVS Health Corporation (CVS) -- 
Covered Calls Position Closed by Decision
The simultaneous buy/write transaction was:
1/11/2024 Bought 300 CVS shares @ $78.90
1/11/2024 Sold 3 CVS 1/26/2024 $78.00 Call options @ $1.58
1/19/2024 Upcoming quarterly ex-dividend of $.665 per share.
The overall performance results (including commissions) for this CVS Health Covered Calls position are as follows:
CVS Covered Calls Net Investment: $23,198.01
= ($78.90 - $1.58) * 300 shares + $2.01 commission
Net Profit Components:
(a) Options Income: +$462.99
= ($1.58 - $.03) * 300 shares - $2.01 commission
(b) Dividend Income: +$199.50
= ($.665 dividend per share x 300 shares)
= +($72.95 stock sales price - $78.90 stock purchase price) * 300 shares
