When we sell covered call or cash-secured put options, there are 2 dates we should factor into our trade decisions. Earnings reports (ER) dates must be considered 100% of the time and ex-dividend dates are important in certain specific scenarios. In this article, a real-life example with PulteGroup, Inc. (NYSE: PHM) will be used to demonstrate how to navigate around these 2 dates.
What are earnings report dates?
These are quarterly filings made by public companies to report their earnings and revenue performance. In the BCI methodology, these should always be avoided, in terms of no option in place, 100% of the time. This is because of the inherent risk from a disappointing ER.
What are ex-dividend dates?
Latest date a shareholder must own a stock to be eligible to receive an upcoming dividend distribution. Ex-dates are the main reason for early exercise. If share retention is an integral part of our trading system, these dates must be avoided when trading options.
PHM on the 8-2024 Premium Stock Report
Overview & closeup images

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- The ER date (red oval) is on 10/22/2024
- The last ex-date was on 6/18/2024 (green oval), so the next is projected to be on 9/18/2024
- Let’s assume we do not want to be subjected to early exercise, we want to avoid both dates
- PHM has weekly options, so we will seek the 9/13/2024 expiration dates which does avoid both
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PHM option-chain on 8/12/2024 for ITM and OTM strikes

- The $120.00 ITM strike shows a bid price of $6.00
- The $127.00 OTM strike shows a bid price of $2.50
- Both strikes show a wide bid-ask spread which is negotiable to higher prices, but we will use the worst-case scenarios of these published prices
PHM initial ITM and OTM calculations using the BCI Trade Management Calculator (TMC)

- The ITM $120.00 strike shows a time-value return of 2.48%, 27.47% annualized (brown cells) based on a 33-day trade
- The ITM $120.00 strike shows a downside protection (of that time-value profit) of 2.45% (purple cell)
- The OTM $127.00 strike shows a time-value return of 2.03%, 27.47% annualized (green cells) based on a 33-day trade
- The OTM $127.00 strikes shows an additional upside potential of 3.24% (pink cell) if share price moves up to or beyond the OTM strike
- The breakeven price points are shown in the yellow cells
Discussion
The 2 key dates we should be aware of when trading options are the ex-dividend dates and earnings report dates. The former is the main reason for early exercise and the latter represents inherent risk if we are exposed to these reports.
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Alan,
I am reading your great book (for the 2nd time) on exit strategies for calls and puts.
I am curious if you would ever roll down a covered call but then roll out or out and up?
If yes, can you describe when this might occur.
Thanks,
Ezra
Ezra,
Yes, definitely. This has come up dozens of times in my portfolios over the years.
When I roll-down, it is typically to an out-of-the-money strike, which allows for some share price recovery in addition to the additional time-value premium.
If, after rolling-down, the stock price accelerates to the extent that the new call strike is now in-the-money at expiration, rolling-out or out-and-up are definite considerations.
One of the questions we should ask ourselves in this scenario is” would we buy the stock today at the current price?”
The stock must still meet our system requirements, including aligning with our initial time-value return goal range.
Alan
Premium Members,
The Weekly Report for 01/03/25 will be delayed due to system issues. I will update you as we make progress in addressing this problem.
Best,
Barry and The Blue Collar Investor Team
[email protected]
Premium Members,
This week’s Weekly Stock Screen And Watch List has been uploaded to The Blue Collar Investor Premium Member site and is available for download in the “Reports” section. Look for the report dated 01/03/25.
Be sure to check out the latest BCI Training Videos and “Ask Alan” segments. You can view them on The Blue Collar YouTube Channel. For your convenience, the link to the BCI YouTube Channel is:
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Reminder: Premium Member’s pricing is locked into your current rate and you will never see a rate increase as long as the membership remains active.
Barry and The Blue Collar Investor Team
Premium members:
This week’s 4-page report of top-performing ETFs, along with our sample trade of the week, has been uploaded to your premium site. The Select Sector SPDR section is now crafted to align with our streamlined (CEO) approach to covered call writing. The report also lists Top-performing ETFs with Weekly options, mid-week market tone as well as the implied volatility of all eligible candidates.
We have also included a sample trade taken from one of our BCI watchlists.
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Alan and the BCI team
Alan,
Wishing you a very happy new year.
I have a question for you and I think I already know what your answer is going to be, but for the sake of conversation, I will ask it anyway .
Do you have an opinion on QDTE? Apparently it’s a fund that uses a poor man’s covered call type strategy and pays 28% annual “dividends”….. and do you have an opinion on JEPI or JEPQ which utilize the more traditional cover call approach to return premium revenue to investors?
I’m curious to hear your thoughts.
Best regards,
Tony
Tony,
When we sell covered calls, we are seeking to outperform the market (significantly). I have yet to find an ETF based on CCW that comes close to outperforming the market (S&P 500). The fund managers don’t have the knowledge, nor the ability to achieve the levels of returns we are capable of. Plus, they must also overcome their administrative fees.
I created a 1-year comparison chart of the S&P 500 versus the 3 securities you alluded to. This is typical of all CCW ETFs that I have researched.
CLICK ON IMAGE TO ENLARGE & USE THE BACK ARROW TO RETURN TO BLOG.
Alan