Established New Covered Call on Bank of America Stock - 0.87% potential return in 7 days

On August 25, 2023, I bought 101 Bank of America shares at $28.57/share and simultaneously sold 1 covered call on them with a strike price of $28.5 and expiry next Friday. Credit received $31.96 (after commissions)

BAC is going ex-dividend on August 31, with a dividend at 0.24 - there is a chance I will also capture the dividend from this trade.

I bought 101 shares, so I have at least one share left in the dividend stock portfolio if options are going to be exercised on or before the expiry.

We are now holding 102 shares with BAC in our stock portfolio.

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.

Here is the trade setup:

• BOT 101 BAC Stock 28.57 USD

• SLD 1 BAC SEP 01 '23 28.5 Call Option 0.33 USD

What happens next?

On the expiry date, September 01, 2023, BAC is trading under $28.5 per share -  options expire worthlessly and I keep premium - if BAC trades above $28.5 on the expiry date, my 100 shares will get called away and I will realize a profit of $24.97 or potential 0.87% income yield in 7 days.

Break-even price: $28.57-$0.31= $28.26

• In total: 11 trades since March 14, 2023

• Options premium: $199