The post when this FedEx Covered Call position was originally established is here. As detailed below, the return-on-investment result was +1.1% absolute return in 14 days (equivalent to a +28.8% annualized return-on-investment).
The buy/write transaction was:
2/23/2024 Bought 100 FedEx shares @ $243.00.
2/23/2024 Sold 1 FedEx 3/15/2024 $237.50 Call option @ $8.10 per share.
3/8/2024 FedEx Call option owner exercised their one Call option, so the Covered Call position was closed out early. The one FDX Call option expired worthless and the 100 FedEx Corporation shares were sold at the $237.50 strike price.
The overall performance results (including commissions) for this FedEx Corporation Covered Call position are as follows:
Covered Call Net Investment: $23,490.67
= ($243.00 - $8.10) * 100 shares + $.67 commission
Net Profit Components:
(a) Option Income: +$809.33
= ($8.10 * 100 shares) - $.67 commission
(b) Dividend Income (Call option exercised early on the business day prior to the ex-div date): +$0.00
(c) Capital Appreciation (FedEx shares assigned early): -$550.00
+($237.50 strike price -$243.00 stock purchase cost) * 100 shares
Total Net Profit: +$259.33
= (+$809.33 option income +$0.00 dividend income -$550.00 capital appreciation)
Absolute Return-on-Investment: +1.1%
= +$259.33/$23,490.67
Annualized Return-on-Investment: +28.8%
= (+$259.33/$23,490.67) * (365/14 days)
