Price decline in SDC (Smile Direct Club) not helping….

SDC was a great performer for us over the past year. Recent price declines are taking a toll on the overall value of my account. In January the stock had generated over $200,000 in unrealized profits. Over the past three months that deteriorated to just $70,000.

Why we do covered calls…..as the stock dropped we rolled the short option strike prices down. The incremental premium collected while rolling down helped offset the stock losses. Profits on the options increased from a loss of $10,000 in January to a gain of $60,000. Overall the net profit for the position has dropped from $190,000 to $140,000 but without the options it would have fallen an additional $70,000.

Hopefully we see some strengthening of SDC stock price in the near future.

Chart data does not have all the position history. Tracking system was updated in January and history was lost….in case you are wondering how the numbers jump so dramatically at the start of the chart.

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