Here is how our fearless, intrepid investor did over the last six weeks in her “fun” portfolio writing 10 covered call contracts on Novavax (NVAX) on Mondays, expiry dates on Fridays of the same week. To lower the risk of being assigned, she wrote those $10 out of the money instead of the usual just out-of-the-money sale, as she did in the past.
We wrote about that previously. Here is a summary.
Total premiums received = $US4,955.00 for the last six weeks.
That comes to $US825.83 per week ($US4,955.00 divided by 6) Her average per share cost was $US58.08 for a total of $US580,800.00. Her average return on investment therefore, is .14% per week ($US825.83 divided by $US580,800.00 multiplied by 100) or 14% annually.
Most “fun” portfolios underperform and cannot equal the S&P 500. Go here for more about “fun” portfolios,
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