On April 1, 2022, I bought 100 shares of NYSE: SPCE stock paying $9.90 per share and simultaneously sold 1 covered call on them with a strike price of $10 and expiry this Friday. Credit received $45 (before commissions)

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.

Those who have followed my newsletter for a while already know I like trading SPCE stock. Unfortunately cannot say that with some great success, mostly I lose. but sometimes not. Let’s hope I will profit from this trade

here is the trade setup:

• BOT 100 SPCE Stock 9.90 USD

• SLD 1 SPCE APR 08 '22 10 Call Option 0.45 USD

I bought 100 shares at $9.90 apiece, in total paying $990 and sold 1 covered call with next Friday’s expiry, for which I received a premium of $45 (before commissions)

What happens next?

On the expiry date, April 08, 2022, NYSE: SPCE is trading under $10 per share -  options expire worthlessly and I keep premium - if SPCE trades above $10 on the expiry date, my 100 shares will get called away and I realize my max profit $52 ($42+$10) or potential 5.25% income yield in 7 days.

Break-even price: $9.90-$0.42= $9.48