May 4, 2013 | Option Trading Basics, Options Calculations, Stock Investing, Stock Option Strategies
Innovative covered call writers can develop ideas of implementing a strategy in unconventional ways. For example, we can invest in a money market or CD and perhaps not even beat the inflation rate with those dividends. We can buy a quality bond and wait six months to...
Apr 6, 2013 | Option Trading Basics, Options Calculations, Stock Option Strategies
When studying option trading basics we learn the equation for option premium value is: Premium = time value + intrinsic value If the strike price is at- or out-of-the-money the premium is all time value. Another basic principle is that time value decreases as we...
Dec 22, 2012 | Stock Trading & Taxes
There has been a lot of hysteria and hyperbole surrounding the expiration of the Bush-era tax cuts and how it might affect dividend income. The Blue Collar Investor’s weekly list of covered call candidates often includes a number of dividend-paying stocks as shown in...
Dec 1, 2012 | Exchange-Traded Funds, Investment Basics, Stock Option Strategies
A critical requirement of my covered call writing system is to be properly diversified by stock, industry and cash allocation. No one stock or industry should represent more than 20% of your portfolio holdings. Owning five different stocks in five different industries...
Aug 4, 2012 | Technical Analysis
Technical analysis is a critical part of our covered call writing success. We use it for both stock selection, exit strategy execution and timing of our trades. We screen stocks fundamentally and technically via the IBD 50, SmartSelect Scan and MSN Scouter. We make...
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