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Established Covered Call on TLRY stock - 18.97% potential income in 137 days
On May 1st, 2023, I bought additional 30 shares of TLRY stock (NASDAQ: TLRY), paying $2.32 per share for my stock portfolio.
With the latest buy, I'm now holding 112 shares of TLRY stock, with an average buy price of $2.74
As I had enough shares for a call option I sold one September 15 call option with a strike price of $3 and received a $27 premium.
This is not trading advice. Investments in stocks, funds, bonds, or cryptos are risk investments and you could lose some or all of your money. Do your due diligence before investing in any kind of asset.
I've been buying small bits of TLRY stock since early February, and for now, I can say that the dollar cost averaging investing works out great.
Here is the trade setup:
BOT 100 TLRY Stock 2.74 USD (dollar-cost averaging)
SLD 1 TLRY SEP 15 '23 3 Call Option 0.27 USD
What happens next?
On the expiry date, September 15, 2023, TLRY is trading under $3 per share - options expire worthlessly and I keep premium - if TLRY trades above $3 on the expiry date, my 100 shares will get called away and I will get back $300
As my original investment in this position is $2.74, I will gain both from the price appreciation + from the premium.
In total $52 in 136 days, about 19% return on investment.
Break Even price: 2.74-0.26= $2.48
Anyhow- TLRY is a troubled investment and most probably it will keep failing, I wouldn’t be surprised to see it falling under $2 or even $1 in 2023. meantime I will keep buying it in small fractions once a month until I will reach 200 shares in my portfolio. This should happen in the next 3-4 months, and then I will evaluate again this position.
The premium received today will be used next month to buy additional TLRY shares, with today’s price it would give 11 shares.