Covered Call - BROS - New Trade

The Trade

BROS is a new ticker, that was not on my radar. I picked it up from a trading group member.

Over the past 5 years, this stock, really did not go anywhere since Apr 2022. That is what I like for my covered calls.

It is like owning an piece of real estate and rent it out by the week or couple of weeks or by the month.

Now based on the chart there is the possibility the stock goes back down to $24ish.

I trade from a 6 months daily chart.

What I like a lot is the Volume profile. The point of control on both charts is roughly at the current trade price. In translation, there is a lot of buying and selling is happening at this price point.

The trade entered on Friday.

Buy 100 shares at 27.80 each for a total of 2780. For selling the Feb 2 C28 the credit was 45$. 45/2780=0.016 or 1.6% for the week.

Goal is to get called out next week and I am also getting another 20$ for capital appreciation. If I don’t get called out, I get to keep the 45$ (rent) and sell a new option. Now that bridge I cross on Friday.

Disclosure

I have been beneficially long the shares in BROS and short the call in BROS. I wrote this article myself and it expresses my own views and opinions. I am not receiving any compensation for this. I have no business relation ship with any company whose stock is mentioned in this article.

I am not an investment advisor or professional. This article is my personal opinion and experience and is not meant to be a recommendation of the purchase or sale of a stock or option. Investors should conduct their own research before investing to see if the companies discussed in this article fit into their portfolio parameters.