Reverse Covered Call Writing: A Reasonable Bear Market Strategy? A Real-Life Example with SPDR S&P ETF Trust (NYSE: SPY)
Covered call writing is defined as first purchasing or already owning the underlying security and then selling the corresponding call option. By doing so, we are protected; we know our cost-basis. A BCI member proposed to me an extreme bear market strategy where a...
The Significance of Breakeven When Constructing Our Poor Man’s Covered Call (PMCC) Trades: A Real-Life Example with International Business Machines Corp. (NYSE: IBM)
The PMCC Strategy involves buying LEAPS call options (expirations 1 – 2 years out) and selling short-term call options against the long position. The technical term is a long call diagonal debit spread. In our BCI methodology, the trade construction must meet a...
BCI PODCAST 92: Selling Deep OTM Cash-Secured Puts to Create High-Probability Returns
Watch Video: Listen To Audio Version: Using weekly deep out-of-the-money cash-secured puts with Deltas of less than 10 can generate significant annualized returns with greater than 90% probability of success. This podcast uses a real-life example from one of...