The short combination options strategy works on the principle of net credit. When the short combination options strategy is initiated, the trader receives a net credit.

A short call is a strategy involving a call option, giving a trader the right, but not the obligation, to sell a security.

The potential loss on a short call is theoretically unlimited, since there's no concrete ceiling to how high a stock can rise. Once the shares rally above $25.63, your losses will begin to add up.