Concentrated positions

What does the position pay? Per year.

Four ways to earn income on a single large holding, and three of them depend on what the client paid for it.

Covered call on the stock · income per year

$10.06 per share

Before tax: $13.20 per share (13.20%)

10.06% of today’s $100.00 share price, earned on the whole share, because nothing was sold.

Gives up: Upside above 110% on any roll that finishes in the money.

Premium collected, not return. At 34% volatility a 110% strike written 8 times a year finishes in the money about 21% of the time, so expect roughly 1.7 assignments a year. Each one either sells the shares or costs money to roll, and none of that is netted out of the figure above.

Income Generated

Every tool, same position

Covered call10.1%Covered-call ETF5.8%Index ETF0.8%Exchange fund0.1%Zero-cost collar0.0%Do nothing0.0%Protective put-6.9%

Income per year as a percent of today’s position value, so the tools that require a sale are already carrying their tax.

Volatility, price, and stock yield fill in from the ticker when live pricing is connected. Everything else is a house assumption you can change here.

Writing calls on NVDA pays 10.1% a year. Selling and buying a covered-call fund pays 5.8%, because $4.76 a share never makes it into the fund. The basis is doing the arguing, not the strategy.

Illustrative only. Not investment, tax, or legal advice. Option premiums are Black-Scholes-Merton at the volatility shown, before commissions, spreads, and the bid-ask on a real single-name chain. Each covered call is priced from today’s share price, which assumes the stock returns to where it started before the next write. Tax is a single blended rate on the full gain with no state layer and no lot detail. Risk-free rate 4.2%.