Latest Insights in Stock Market Investing
Unusual Strike Prices and Contract Adjustments: A Real-Life Example with ARK Next Generation Internet ETF (NYSE: ARKW)
We enter a covered call writing trade for a particular strike and then that strike disappears. What happened? Is this a bad dream? Actually, this is a bit unusual but not an extremely rare occurrence. Contract adjustments are associated with corporate events like...
BCI PODCAST 60: Combining ITM Call Strikes & Stock Dividends to Protect in Bear Markets
Watch Video: Listen To Audio Version: The reason covered call writing allows us to beat the market on a consistent basis is that it lowers our cost-basis. In bear and volatile markets we may choose to structure the strategy to provide even greater protection. This may...
Understanding the Math of Unwinding Covered Call Writing Trades Early: A Real-Life Example with Invesco Solar ETF (NYSE: TAN)
On October 6, 2020, Alex from Mexico shared with me a covered call writing trade he executed with TAN. He was considering unwinding the trade using our mid-contract unwind exit strategy and wanted to know how I analyze these scenarios. This article will detail the...
BCI PODCAST 59. ANALYZING 2 Month and 4-Day Covered Call Trades
Watch Video: Listen To Audio Version: When calculating our covered call writing returns, there are 2 sets of computations that shouldn't be confused. One is the calculations we use to make the best trading decisions at any given point in time. The other relates to...
Selecting the Best ITM Strikes for Covered Call Writing: A Real-Life Example with Etsy, Inc. (Nasdaq: ETSY)
In challenging market environments, we favor in-the-money strikes for our covered call trades. The intrinsic-value component of our option premiums will provide additional downside protection and lower the breakeven price point (BE) below that of at-the-money and...
BCI PODCAST 58: Is This Trade a Winner or a Loser?
Watch Video: Listen To Audio Version: When evaluating our covered call trades we must understand the difference between "realized" and "unrealized" returns. This podcast will analyze a series of trades with Energy Select Sector SPDR Fund (XLE) which includes initial...
Dividends and After-Hour News Causing Exercise of OTM Call Strikes: A Real-Life Example with Financial Select Sector SPDR Fund (NYSE: XLF)
On December 21, 2020, Donna shared with me a successful trade she executed with XLF. What made this trade interesting was that the option was exercised after expiration when the strike closed out-of-the-money. This article will examine the reasons for this unusual...
BCI PODCAST 57. Evaluation Stock Purchase Price and Breakeven When Rolling Options
Watch Video: Listen To Audio Version: There are 2 sets of calculations we must analyze when rolling our covered call options out-and-up. The first is based on making the best trading decisions at any given point in time. The second is when evaluating our overall...
Using Delta to Create Low-Risk/ High-Return Put-Selling Trades: A Real-Life Example with ETSY, Inc. (NASDAQ: ETSY)
When selling cash-secured puts, our strikes are selected based on our initial time-value return goal range and personal risk-tolerance. In the BCI methodology, we use only out-of-the-money (OTM) cash-secured puts unless our objective is to purchase a stock at a...
Podcast
- 126. Analyzing the Status of a Rolling-Down Trade
- 124. Dividends and After-Hours News Causing Exercise of OTM Call Strikes
- 123. Implied Volatility, IV Rank and IV Percentile Defined and Practical Applications
- BCI PODCAST 122: Should I Roll-Out My Deep In-The-Money Call Option Mid-Contract?
- BCI PODCAST 121: What is a SPAC (Special Purpose Acquisition Company)?
- 120. Using the Nasdaq-100 Volatility Index (VOLQ) in Covered Call Writing Decisions
- 119. Establishing Our Cost-Basis for Long-Term Holdings
- 118. Adjusting Our Portfolio Mix to Achieve Diversification and Cash Allocation
- 117. When a Covered Call Strike Moves $1000.00 In-The-Money
- 116. How to Execute a Covered Call Trade with a Buy/Write Combination Form
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