How to Improve Results for a Rolling-Down Covered Call Trade

Mar 22, 2025 | Covered Call Exit Strategies, Exchange-Traded Funds, Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Option Strategies

click ↑ 4 Featured Rolling down is a frequently used covered call writing exit strategy to mitigate when share price declines. The original sold option is closed (bought back), while simultaneously opening another at a lower strike in the same contract cycle. When...
Setting Up a Covered Call Trade: Step-by-Step Process + New Trade Video

Setting Up a Covered Call Trade: Step-by-Step Process + New Trade Video

Feb 15, 2025 | Covered Call Exit Strategies, Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Option Strategies

click ↑ 4 Featured Establishing our covered call trades require a sequential process including stock selection, option selection and position management. This article will analyze the procedures using a real-life example with Tenet Healthcare Corp. (NYSE: THC). Stock...
Rolling-Out Our Covered Call Trades After Rolling-Down

Rolling-Out Our Covered Call Trades After Rolling-Down

Jan 25, 2025 | Covered Call Exit Strategies, Exchange-Traded Funds, Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Option Strategies

click ↑ 4 Featured Market volatility can cause our covered call trades to whipsaw up and down, much like a roller-coaster. In this article, a real-life trade with The Industrial Select Sector SPDR Fund (NYSE: XLI) will be analyzed. In this series of trades, shared...
Calculating Covered Call Trades that are Converted to Collar Trades

Calculating Covered Call Trades that are Converted to Collar Trades

Dec 7, 2024 | Covered Call Exit Strategies, Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Put-selling, Stock Option Strategies

click ↑ 4 Featured What is a Collar Trade? The collar strategy consists of 3 legs: Buy stock (long position) Sell an out-of-the-money (OTM) call option (short call- ceiling) Buy an out-of-the-money protective put (long put- floor) Since a protective put debit is added...
Doubling Our Maximum Covered Call Returns Using the Mid-Contract Unwind (MCU) Exit Strategy

Doubling Our Maximum Covered Call Returns Using the Mid-Contract Unwind (MCU) Exit Strategy

Nov 30, 2024 | Covered Call Exit Strategies, Exchange-Traded Funds, Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Option Strategies

click ↑ 4 Featured Our covered call writing trades offer 2 income streams when using out-of-the-money (OTM) call strikes. (Make that 3, if we incorporate dividends into the strategy). These consist of option premium + share appreciation from current market value up...