The following tables are examples of how your money can compound using covered
calls. They are provided for informational use only:
- Investing in stocks and options involve risk, people can and do lose
money
- The investments shown are compounded at 7% monthly. It is possible to earn more
than 7% in a given month and it is also likely you will earn less in others.
We feel that 7% is a good average for successful covered call writers
- No commissions or other fees are calculated in these charts. There are
fees and commissions associated with these types of transactions.
- The Capital Gains Tax rate used in the tables is the highest rate
possible. many investors tax rate is much less than the one used and therefore
those investors would see better results than the ones listed.
|
$8,000 invested in an IRA Account earning 7%
monthly using Covered Calls
|
|
|
Year 1
|
Year 2
|
Year 3
|
Year 4
|
Year 5
|
Year 6
|
Year 7
|
Year 8
|
|
Month 1
|
$ 8,560
|
$19,279
|
$43,419
|
$ 97,789
|
$220,239
|
$ 496,021
|
$1,117,135
|
$2,516,003
|
|
Month 2
|
$ 9,159
|
$20,628
|
$46,459
|
$104,634
|
$235,656
|
$ 530,743
|
$1,195,335
|
$2,692,123
|
|
Month 3
|
$ 9,800
|
$22,072
|
$49,711
|
$111,959
|
$252,152
|
$ 567,895
|
$1,279,008
|
$2,880,571
|
|
Month 4
|
$10,486
|
$23,617
|
$53,191
|
$119,796
|
$269,803
|
$ 607,648
|
$1,368,539
|
$3,082,211
|
|
Month 5
|
$11,220
|
$25,271
|
$56,914
|
$128,181
|
$288,689
|
$ 650,183
|
$1,464,336
|
$3,297,966
|
|
Month 6
|
$12,006
|
$27,039
|
$60,898
|
$137,154
|
$308,897
|
$ 695,696
|
$1,566,840
|
$3,528,824
|
|
Month 7
|
$12,846
|
$28,932
|
$65,161
|
$146,755
|
$330,520
|
$ 744,394
|
$1,676,519
|
$3,775,842
|
|
Month 8
|
$13,745
|
$30,957
|
$69,722
|
$157,028
|
$353,656
|
$ 796,502
|
$1,793,875
|
$4,040,150
|
|
Month 9
|
$14,708
|
$33,124
|
$74,603
|
$168,020
|
$378,412
|
$ 852,257
|
$1,919,446
|
$4,322,961
|
|
Month 10
|
$15,737
|
$35,443
|
$79,825
|
$179,781
|
$404,901
|
$ 911,915
|
$2,053,808
|
$4,625,568
|
|
Month 11
|
$16,839
|
$37,924
|
$85,413
|
$192,366
|
$433,244
|
$ 975,749
|
$2,197,574
|
$4,949,358
|
|
Month 12
|
$18,018
|
$40,579
|
$91,392
|
$205,831
|
$463,571
|
$1,044,052
|
$2,351,404
|
$5,295,813
|
|
$10,000 invested in a standard account earning 7% monthly and
paying 39.6% Capital Gains Tax yearly, using Covered Calls
|
|
Year
1 |
Year
2 |
Year
3 |
Year
4 |
Year
5 |
Year
6 |
Year
7 |
Year
8 |
|
Month
1 |
$ 10,700
|
$ 18,793
|
$ 33,006
|
$ 57,969
|
$ 101,813
|
$ 178,816
|
$ 314,059
|
$ 551,589
|
|
Month
2 |
$ 11,449
|
$ 20,108
|
$ 35,316
|
$ 62,027
|
$ 108,940
|
$ 191,333
|
$ 336,043
|
$ 590,200
|
|
Month
3 |
$ 12,250
|
$ 21,516
|
$ 37,789
|
$ 66,369
|
$ 116,565
|
$ 204,727
|
$ 359,566
|
$ 631,514
|
|
Month
4 |
$ 13,108
|
$ 23,022
|
$ 40,434
|
$ 71,015
|
$ 124,725
|
$ 219,057
|
$ 384,736
|
$ 675,720
|
|
Month
5 |
$ 14,026
|
$ 24,633
|
$ 43,264
|
$ 75,986
|
$ 133,456
|
$ 234,391
|
$ 411,667
|
$ 723,021
|
|
Month
6 |
$ 15,007
|
$ 26,358
|
$ 46,293
|
$ 81,305
|
$ 142,798
|
$ 250,799
|
$ 440,484
|
$ 773,632
|
|
Month
7 |
$ 16,058
|
$ 28,203
|
$ 49,533
|
$ 86,996
|
$ 152,793
|
$ 268,355
|
$ 471,318
|
$ 827,787
|
|
Month
8 |
$ 17,182
|
$ 30,177
|
$ 53,000
|
$ 93,086
|
$ 163,489
|
$ 287,140
|
$ 504,310
|
$ 885,732
|
|
Month
9 |
$ 18,385
|
$ 32,289
|
$ 56,710
|
$ 99,602
|
$ 174,933
|
$ 307,239
|
$ 539,612
|
$ 947,733
|
|
Month
10 |
$ 19,672
|
$ 34,550
|
$ 60,680
|
$ 106,574
|
$ 187,179
|
$ 328,746
|
$ 577,385
|
$ 1,014,074
|
|
Month
11 |
$ 21,049
|
$ 36,968
|
$ 64,928
|
$ 114,034
|
$ 200,281
|
$ 351,758
|
$ 617,801
|
$ 1,085,059
|
|
Month
12 |
$ 22,522
|
$ 39,556
|
$ 69,473
|
$ 122,017
|
$ 214,301
|
$ 376,381
|
$ 661,048
|
$ 1,161,014
|
|
|
|
|
|
|
|
|
|
|
Taxes |
$ 4,959
|
$ 8,709
|
$ 15,296
|
$ 26,865
|
$ 47,183
|
$ 82,868
|
$ 145,544
|
$ 255,622
|
|
Net |
$ 17,563
|
$ 30,847
|
$ 54,177
|
$ 95,152
|
$ 167,118
|
$ 293,513
|
$ 515,504
|
$ 905,392
|
| $10,000 invested
in a standard account earning 7% monthly, adding
$250 a month, and paying 39.6% Capital Gains Tax
yearly, using Covered
Calls |
|
|
|
|
|
|
|
|
|
|
Year
1 |
Year
2 |
Year
3 |
Year
4 |
Year
5 |
Year
6 |
Year
7 |
Year
8 |
|
Month
1 |
$ 10,700
|
$ 22,954
|
$ 44,476
|
$ 82,276
|
$ 148,665
|
$ 265,264
|
$ 470,052
|
$ 829,724
|
|
Month
2 |
$ 11,717
|
$ 24,828
|
$ 47,857
|
$ 88,303
|
$ 159,339
|
$ 284,101
|
$ 503,223
|
$ 888,073
|
|
Month
3 |
$ 12,804
|
$ 26,834
|
$ 51,474
|
$ 94,751
|
$ 170,760
|
$ 304,255
|
$ 538,716
|
$ 950,505
|
|
Month
4 |
$ 13,968
|
$ 28,980
|
$ 55,345
|
$ 101,652
|
$ 182,980
|
$ 325,820
|
$ 576,694
|
$ 1,017,308
|
|
Month
5 |
$ 15,213
|
$ 31,276
|
$ 59,487
|
$ 109,035
|
$ 196,057
|
$ 348,895
|
$ 617,330
|
$ 1,088,787
|
|
Month
6 |
$ 16,546
|
$ 33,733
|
$ 63,918
|
$ 116,935
|
$ 210,048
|
$ 373,586
|
$ 660,810
|
$ 1,165,270
|
|
Month
7 |
$ 17,971
|
$ 36,361
|
$ 68,660
|
$ 125,387
|
$ 225,019
|
$ 400,004
|
$ 707,334
|
$ 1,247,106
|
|
Month
8 |
$ 19,497
|
$ 39,174
|
$ 73,734
|
$ 134,432
|
$ 241,038
|
$ 428,272
|
$ 757,115
|
$ 1,334,671
|
|
Month
9 |
$ 21,129
|
$ 42,184
|
$ 79,163
|
$ 144,110
|
$ 258,178
|
$ 458,518
|
$ 810,381
|
$ 1,428,365
|
|
Month
10 |
$ 22,876
|
$ 45,404
|
$ 84,972
|
$ 154,465
|
$ 276,518
|
$ 490,882
|
$ 867,375
|
$ 1,528,619
|
|
Month
11 |
$ 24,744
|
$ 48,850
|
$ 91,187
|
$ 165,545
|
$ 296,142
|
$ 525,511
|
$ 928,359
|
$ 1,635,889
|
|
Month
12 |
$ 26,744
|
$ 52,537
|
$ 97,838
|
$ 177,401
|
$ 317,139
|
$ 562,565
|
$ 993,611
|
$ 1,750,669
|
|
|
|
|
|
|
|
|
|
|
Taxes |
$ 5,542
|
$ 11,221
|
$ 21,194
|
$ 38,712
|
$ 69,478
|
$ 123,514
|
$ 218,418
|
$ 385,100
|
|
Net |
$ 21,202
|
$ 41,317
|
$ 76,643
|
$ 138,689
|
$ 247,661
|
$ 439,051
|
$ 775,193
|
$ 1,365,569
|
|
