Covered Call and Dividend Capture for FOXA – 2 Days, 1% Return on Capital, 234% Annualized

On 3/8 we established a covered call with the intent of capturing a dividend. We purchased 500 shares of FOXA shares and sold a Mar 12 $41 Call. The dividend of $.21 went exdiv of 3/9. We sold the shares on 3/10. The shares appreciated in value generating a gain of $315. The stock appreciation resulted in the option losing $182 when we repurchased the option to close the position. The dividend generated $115. Overall the position generated $255 in profit in two days.

This is one of our first attempts at using covered calls to capture a dividend and exit the position immediately after it goes exdiv. We have a number of similar positions to see if we can consistently generate good short term profit with the strategy.

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