This afternoon a Covered Call position was established in The Cigna Group (ticker symbol CI) using my Dividend Capture Strategy (see post describing this strategy
here). One hundred Cigna shares were purchased at $287.06 and one March 13th, 2026 Call option was sold for $15.56 per share at the $275.00 strike price. The buy/write
net debit limit order at $271.50 was executed, so the potential time value profit is $3.50 per share [$15.56 Call option premium - ($287.06 stock purchase price - $275.00 strike price)]. There is an upcoming quarterly ex-dividend of $1.56 (annual dividend yield of 2.2%) on March 5th, so the potential return-on-investment results detailed below for this position includes this dividend income.
As preferred by the Covered Calls Advisor, Cigna's next quarterly earnings report on May 27th, 2026 will be after the March 13th options expiration date. Given the Covered Calls Advisor's current Overall Market Meter indicator of Neutral, an in-the-money Covered Call position was established with the probability the stock is in-the-money on the options expiration date was 72.3%.
As detailed below, two potential return-on-investment results are: (1) +1.3%
absolute return-on-investment (equivalent to +33.5% annualized return-on-investment over the next 14 days) if the stock is assigned on the day prior to the March 5th ex-dividend date; or (2) +1.9% absolute return-on-investment (equivalent to +30.9% annualized return-on-investment over the next 22 days) if the stock is assigned on the March 13th, 2026 options expiration date.
Cigna Corporation (CI) -- New Covered Call Position
The buy/write transaction today was as follows:
2/19/2026 Bought 100 Cigna Corp. shares @ $287.06
2/19/2026 Sold 1 Cigna 3/13/2026 $275.00 Call option @ $15.56 per share.
3/5/2026 Upcoming quarterly ex-dividend of $1.56 per share
Two potential overall performance results (including commissions) for this Cigna Covered Call position are as follows:
Covered Call Cost Basis: $27,150.67
= ($287.06 - $15.56) * 100 shares + $.67 commission
Net Profit Components:
(a) Option Income: +$1,555.33
= ($15.56 * 100 shares) - $.67 commissions
(b) Dividend Income (If Cigna shares assigned on the day prior to the March 5th ex-dividend date): +$0.00
(b) Dividend Income (If Cigna shares assigned at the March 13th, 2026 options expiration date): +$156.00
= ($1.56 dividend per share x 100 shares)
(c) Capital Appreciation (If Cigna shares assigned on the day prior to the March 6th ex-dividend date): -$1,206.00
+($275.00 strike price - $287.06 stock purchase price) * 100 shares
(c) Capital Appreciation (If Cigna shares assigned at the $275.00 strike price at options expiration): -$1,206.00
+($275.00 - $287.06) * 100 shares
1. Total Net Profit (If Cigna shares assigned on the day prior to the March 5th ex-dividend date): +$349.33
= (+$1,555.33 option income + $0.00 dividend income - $1,206.00 capital appreciation)
2. Total Net Profit (If Cigna shares assigned at the March 13th, 2026 options expiration date): +$505.33
= (+$1,555.33 option income + $156.00 dividend income - $1,206.00 capital appreciation)
1. Potential Absolute Return-on-Investment (If Cigna shares assigned on the day prior to the March 5th ex-dividend date) : +1.3%
= +$349.33/$27,150.67
Potential Annualized Return-on-Investment: +33.5%
= (+$349.33/$27,150.67) *(365/14 days)
2. Potential Absolute Return-on-Investment (If Cigna shares assigned at the March 13th, 2026 options expiration date): +1.9%
= +$505.33/$27,150.67
Potential Annualized Return-on-Investment: +30.9%
= (+$505.33/$27,150.67) *(365/22 days)
At least eight of the nine metrics used in the Covered Calls Advisor's Dividend Capture Strategy spreadsheet must be 'YES' prior to establishing a position. As shown below with this Cigna Group position, all nine criteria are met.
