February Expiration
The expiration of our February covered calls is today, and we have two positions (KSS and SNAP) that are deep-in-the-money and will almost certainly be called away for maximum gains (great scenario) and another (AA) that is just in-the-money and likely to be called, but it will come down to the close (good scenario).
Below are the details/profits from these trades.
Kohl’s (KSS): Bought stock at 38.90 and sold the February 40 call for $2.90.
With the stock now trading now at $48.50 we will likely walk away with a profit of $400 per covered call, or a yield of 11.1%.
You do not need to adjust this position and come Monday we will not have a stock or option position in KSS.
Snap Inc. (SNAP): Bought stock at 55.80 and sold the February 55 call for $5.80.
With the stock now trading now at $62.87 we will likely walk away with a profit of $500 per covered call, or a yield of 10%.
You do not need to adjust this position and come Monday we will not have a stock or option position in SNAP.
Alcoa (AA): Bought stock at 20.40 and sold the February 21 call for $1.95.
This trade is a close call, with the stock now trading at $21.50 it could come down to the wire at the close today as to whether or not we will be assigned. If the stock closes above 21, we walk away with our profit of $255 per covered call, or a yield of 13.8%.
If AA closes below 21, I will likely sell out of the stock on Monday morning.