Continuing with my covered call game, I bought 400 shares of SJM at $124.51 on 3/20/2024 and sold 4 call contracts against the position for $3.20 with a $125 strike price and 4/19 expiration. I immediately collected $1,280 in premiums for the sale of the calls ($3.20 x 400). The options expired on 4/19, and the shares closed at 114.76. Accordingly, my shares were not called away.
Today, 4/24, with the stock trading near 119, I sold 5/17 $125 calls for .60 each. On 5/16, the stock goes ex-dividend. Thus, I’ll pick up rights to the dividend payout, which will be on 6/3/2024. The dividend is $1.06 per share. Accordingly, I’m scooping up a combined total of $1.66 per share this month.
Running totals on cash generated: $644, from 3/17 calls; $1,280 from 4/19 calls; $240 from 5/17 calls; and, $424 from dividend (as of 5/16). That’s $2,588 total since the game began on 3/6. Wouldn’t it be interesting if I added a zero to the number of shares, number of calls, and cash generated? Something to think about.
With Love,
P. Gustav Mueller, author of The Present
Middle-aged Man Sells Covered Calls on SJM, Again