Rolled Forward Covered Call on SESN; Potential Income return 9% in 42 days

On August 20, 2021, I rolled forward 1 covered call on SESN stock expiring on September 17. For this trade, I got $6 (before commissions)

This trade comes as the #21 in the month of August, according to my trading plan for this month, the premium generated from this trade makes me about 0.25% of my $1,400 monthly goal.  While in total I have reached already 90.32% so far. Awesome.

Originally this trade was opened on August 9, 2021, as a credit spread. 7 credit spreads with expiry still set in September, but apparently, some decided to use his rights and exercised 100 shares. Well, that's how it works.

Here is the trade setup:

  • SLD 1 SESN SEP 17 '21 2 Call Option 0.06 USD

It was hard to receive any decent premium here, but I still feel glad getting those 6 bucks here

What happens next?

On the expiry date, September 17, 2021, SESN is trading under $2 per share -  options expire worthlessly and I keep premium - if SESN trades above $2 on the expiry date, my 100 shares will get called away and I will get $200

When originally setting up the credit spread I already got $0.47 per share, my new break-even price for this trade then is $4-$0.47-$1.60-$0.07-$0.03 = $1.82

Let’s hope the company doesn’t file for bankruptcy (but this doesn’t seem the case). I guess it might take about one year sitting in this trade and hopefully breaking even. Will see.