Sold 5 Covered Calls on FCEL – 19.96% potential income return in 53 days

On August 6, 2021, I sold 5 covered calls on FCEL stock with an expiry set in the next 35 days (September 10, 2021). For this trade, I got a premium of $218 (after commissions)

I entered this trade, just shortly before got assigned 500 shares with FCEL stock at $6.5 apiece.

Originally this trade was entered as a credit spread back on July 19, 2021.

Covered Calls with Reinis Fischer
Sold 5 Credit Spreads on FCEL – 4.99% potential income return in 18 days
On July 19, 2021, I sold 5 bull put credit spreads on FCEL stock with an expiry set in the next 18 days. For this trade, I got a premium of $181 (after commissions) FuelCell Energy, Inc. is an American fuel cell power company. It designs, manufactures, operates, and services Direct Fuel Cell power plants that run on natural gas and biogas…
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FuelCell Energy, Inc. is an American fuel cell power company. It designs, manufactures, operates, and services Direct Fuel Cell power plants that run on natural gas and biogas.

This trade comes as the #3 in the month of August, according to my trading plan for this month, the premium generated from this trade makes me about 15.57% of my $1,400 monthly goal.  While in total I have reached already 34.94% so far. Awesome.

Here is the trade setup:

  • BOT 500 FCEL Stock 6.50 USD (assigned)

  • SLD 5 FCEL SEP 10 '21 7 Call Option 0.46 USD

For this trade, I got a premium of 218 USD (after commissions). In case my strike price will be reached on the expiry date I will realize a 19.96% potential income return in 53 days

I decided to roll up a bit my strike price from $6.5 to $7

What happens next?

On the expiry date, September 2021, FCEL is trading above $7 per share -  my 500 shares get called away and I realize my max return

If the strike price will not be reached, I will roll forward these contracts and collect more premiums.

The Break-even price for this trade = $5.71

From the premiums received I bought additional 17 shares with AWP stock. This purchase will contribute to my dividend portfolio an additional $0.57 every month. Awesome