Roll Forward and down 1 Covered Call on FuelCell Energy stock (NASDAQ:FCEL) - Potential income return 6.22% in 28 days

On June 18, 2021, we rolled forward and rolled down 1 covered call on the FuelCell Energy stock (NASDAQ:FCEL) with a new expiry date on June 25, 2021. The aftermath of this trade: +$14.6 (after commissions)

We have been in this trade since the end of May, when we got assigned 100 shares at $10.5, see: New Covered Call on FuelCell Energy stock (NASDAQ:FCEL) - Potential income return 2.72% in 7 days

With the FCEL not reaching our strike price of $11.5 and dropping under $9 on the expiry date, we decided to roll down our strike price and roll to the next week

here is our trade setup:

  • SLD 1 FCEL JUN 25 '21 10 Call Option 0.17 USD

what can happen next:

FCEL is trading below our strike price of $10 at the expiry date (June 25, 2021), in such case, we keep the premium and sell more covered calls to lower our cost basis. 

In case FCEL is trading above our strike price of $10, our 100 shares get called away at the strike price of $10 and we realize our max gain of $65.4 or 6.22% potential total income return in 28 days

Break-even: $9.37