Rolling Forward 1 Covered Call on Virgin Galactic Holdings (NYSE:SPCE) - Potential income return 8.61% in 10 days

On May 14, 2021, we rolled forward 1 covered call contract on Virgin Galactic Holdings (NYSE:SPCE). For this trade, we got a $42 premium (before commissions)

Virgin Galactic is an American spaceflight company within the Virgin Group. It is developing commercial spacecraft and aims to provide suborbital spaceflights to space tourists. Virgin Galactic's suborbital spacecrafts are air launched from beneath a carrier airplane known as White Knight Two.

We have been in this trade since May 11, when we bought 100 shares paying $16.7

Here is our trade setup: 

  • SLD 1 SPCE MAY 21 '21 17 Call Option 0.42 USD

what can happen next:

SPCE is trading below our strike price of $17  at the expiry date (May 21, 2021), in this case, we keep the premium and sell more covered calls to lower our cost basis. 

In case SPCE is trading above our strike price of $17, our 100 shares get called away at the strike price of $17 and we realize our max gain $143.9 or 8.61% potential return of income in 10 days. 

Break-even: $15.57