Disclaimer: I would encourage anyone who is interested in options trading to do some research to understand fully how they work, for writing AND buying before making it a part of their financial investment strategy.
Please don't take any of this as overall criticism, I'm not going down that path on a Saturday - but, there are inaccuracies and fallacies in your response here that belie any ability to make an accurate interpretation of what the risk/reward is for writing the covered calls in the scenario I have described.
If we're going to use numbers and maths for the exercise, the fundamentals and the numbers should be at least close to accurate and the maths, both operator and formula should be as well.
In the example you write above, the current stock price of Tesla "was at $900" isn't really relevant to the maths at exercise, either at expiration or before (depending on what country the options are written in) since it's the STRIKE PRICE that is relevant and in your example above that is written at $1000. So, IF called away, you're never going to get LESS than $1000 for those shares, so not $900 at all regardless of where the stock price is. although, I will say you're NEVER getting called away if the stock is trading LESS than $1000 at expiration of before.. regardless the gross amount IF called is not less than $1000.
The 2nd point I'll make is, for a $1000 stock, the PER SHARE option price (and you can't really buy less than 100 shares making one CONTRACT - save for some very few index options and maybe a FEW stocks) is most likely NEVER going to be 5$ PER SHARE, or $500 per contract. The ONLY time I could imagine a % price option as that would be about 60 seconds before market close on the third Friday of every month. ;-) .
Just for kicks and giggles I pulled up Mar'22 TSLA ATM strike ~1050$ and it's trading at $110 PER SHARE, so you'd net an $11,000 premium for the one contract CC. Even if I use the percentage from your hypothetical above (trading at $900, strike sold at $1000) lets call it 111% above current price, we'll pick a strike at 1130 for Mar'22 and that traded on Friday at $75 A SHARE, so 15 TIMES the $5 example you noted.. so the net credit would be $7500. It does make a different since that is more than 10 times the expected premium in your example. Overall, IF called away at some point, above $1130 you're covered for $1130+$75 per share or $1205. While less than in your hypothetical when trading at $1200 its not less than LESS than. If you fail every time to sell CC and always get called away, then one is certainly doing something wrong or haven't read the tea leaves write (RIGHT/WRITE I think there is an option pun in there somewhere) so yes, the NET result would always be losing money and being called - and probably VERY frustrated.
But, also as I said, the GAP UP that can and sometimes does occur is what CAN bite you, but the financial impact is not the same level of magnitude that you indicated at all. Its one of the reasons I don't often SELL LEAPS which are so far out in TIME well anything can happen.. but at times, BUYING the OTM LEAP can be VERY rewarding if I'm really bullish, but others less so and the LEAPS see much less volume than the 30-90's or before and after earnings, etc.
