All 14 positions in the account are profitable. Five (ILMN, LNC, MDT, MS, RGEN) are more profitable due to covered calls. The other 8 positions would have been more profitable just holding the stock (stock prices have moved up faster than planned in covered call strategy). On the weekend we had three positions assigned (ISRG, MDT and MS). Having the shares called away will help manage the amount of margin in the account which has been increasing each week due to the costs of “rolling up” to higher strike prices as the stock prices have been increasing.
We established the ISRG Covered Call strategy on 8/10 and held it for 67 days. Each week we would roll the options depending on what happened to the stock price. With the assignment the position generated a profit of $5,822, 4.35% or 23% annualized. ISRG has the volatility needed to generate good option premiums and we would consider establishing another covered call against the stock.
The Covered Call on Morgan Stanley (MS) was established on July 24 and held for 85 days. Similar to ISRG we rolled the options every week. The position generated a profit of $2,320, 4.6% or 20% annualized.
The Medtronic (MDT) covered call was established on 9/1/20 and held for 45 days. The position generated a profit of $2,540 in 45 days, 2.4% or 19% annualized.