An example would be selling the Jan 2021 $13 strike. You would collect around $14k for the premium if you sell 200 contracts which is yours to keep no matter what. If the stock price on that date is above $13 + the premium they paid $0.68 = $13.68 it will most likely be exercised and you would have to sell the shares at 13.00. So 20000 shares at $13 would be $260,000. So add $260,000 + $14,000 that you collected up front on the premium and your loss would be around $25k if the stock closed on that date above $13.68. However, if it doesn’t get above $13.68 by then, the contract expires worthless and you keep the premium and shares. Of course there is fees but thats kinda of the basics of how it works.