Latest Insights in Stock Market Investing
Special 1-Time Cash Dividends for Stocks with Improving Technicals
Covered call writing and put-selling candidates must pass a series of fundamental, technical and common-sense screens in order to be considered eligible for our portfolios. In early January 2017, one of our members, Jim W, asked about using Ford Motor Corp. (F), a...
Temporary Self-Loans for the Mid-Contract Unwind Exit Strategy
The mid-contract unwind (MCU) exit strategy is a position management maneuver we use to generate a second income stream in the same month with the same cash investment. The opportunity arises when share price moves significantly higher than the short call strike in...
Managing Great Stocks After Disappointing Earnings Reports
Never sell a covered call option or cash-secured put if there is an earnings report due out prior to contract expiration. This is one of the golden rules of the BCI methodology. We know that a report that disappoints generally did not meet market consensus regarding...
Selling LEAPS and Covered Call Writing
In our BCI methodology we favor Monthly or Weekly options for our short covered call writing positions. I am frequently asked why I don't utilize LEAPS options (expire 9 - 24 months in the future) to garner a much higher premium and perhaps require less management...
Using Technical Indicators to Assist with Strike Selection
When selling covered call or put options, strike price selection is one of the three required skills. Here are the main factors we evaluate when determining which strike price to select: Overall market assessment Personal risk tolerance Return goals Technical price...
Setting Up a Covered Call Trade by First Selling an Out-Of-The-Money Put
A covered call trade can be initiated by first purchasing the underlying stock or exchange-traded fund (ETF). It can also be launched by first selling an out-of-the-money (OTM) cash-secured put and allowing exercise if the put strike is in-the-money (ITM) at...
Indexing: A Key Component to Successful Long-Term Investing
In my book, Stock Investing for Students, I develop a long-term investment plan to achieve financial independence and an early retirement. The plan is initiated by using broad market index funds. This article will highlight the reasons why I favor passively-managed...
Is Covered Call Writing a Zero Sum Game? Let’s Do the Math
Many assume that covered call writing is a zero sum game because we have traders executing equal but opposite trades using the same underlying security. As a covered call writer, we may sell 5 contracts of AAPL which means there is a buyer out there who just bought...
Should We Favor Put-Selling Over Covered Call Writing?
Many consider covered call writing and selling cash-secured puts the same strategy with the same risk-reward profiles. To me, they are similar with slight differences that must be understood to make a decision as to which strategy to favor. In the end, it will be like...
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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