WFC Covered Call
Wells Fargo has taken a beating in 2019 and 2020. With stock falling significantly, I believe the stock is due for a bounce. I bought 100 shares on 6/3/2020 @ $28.86 and due to volatile expectancy of this stock, I sold an ITM 28.50 sell call for a credit of $2.12.
My max profit is $212 - intrinsic value ($36) =$176 or 6.09% max profit at expiration on July 10th, 2020.
I do think the stock could go up 6% in the next 30 days, but it also could be very choppy. To limit my risk, the covered call protects my position to the break even price of 26.74. I will also reach my max profit as long as the stock stays above 28.50; In this scenario, I have a higher probability of success than just by the shares, at the same time, I do limit my profits.
Hit the Like button if you want to be updated. Goodluck.
My max profit is $212 - intrinsic value ($36) =$176 or 6.09% max profit at expiration on July 10th, 2020.
I do think the stock could go up 6% in the next 30 days, but it also could be very choppy. To limit my risk, the covered call protects my position to the break even price of 26.74. I will also reach my max profit as long as the stock stays above 28.50; In this scenario, I have a higher probability of success than just by the shares, at the same time, I do limit my profits.
Hit the Like button if you want to be updated. Goodluck.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.