Is Covered Call Writing an Option Zero-Sum Strategy? + See Our New “Featured Product” Section

Is Covered Call Writing an Option Zero-Sum Strategy? + See Our New “Featured Product” Section

Sep 30, 2023 | Covered Call Exit Strategies, Investment Basics, Just Alan, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Option Strategies

click ↑ 4 Featured Covered call writing is not a zero-sum strategy. Both the option-seller (call writer … us) and the call buyer can be successful. This article will provide a hypothetical example, demonstrating a scenario where both call buyer and seller end up...
When Should I Take My Profits with a Successful Covered Call Writing Trade?

When Should I Take My Profits with a Successful Covered Call Writing Trade?

Sep 9, 2023 | Covered Call Exit Strategies, Exchange-Traded Funds, Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Option Strategies

Which %, if any, of our original covered call writing initial time-value return, should we use to close both legs of the trade, and guarantee a realized return? 60%? 75%? Higher? Lower? Closing both legs of a covered call writing trade mid-contract is known as the...
Comparing Covered Call Writing & Cash-Secured Puts in Bull Market Environments

Comparing Covered Call Writing & Cash-Secured Puts in Bull Market Environments

Aug 19, 2023 | Covered Call Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Option Strategies

Covered call writing versus cash-secured puts in bull markets … which is better? This article will present the arguments for both and make a case why I prefer covered call writing in favorable, uptrending market conditions. The case for cash-secured puts (CSP)...
Should I Allow Exercise & Repurchase the Stock or Roll the Option?: A Real-Life Example with Tesla, Inc. (Nasdaq: TSLA)

Should I Allow Exercise & Repurchase the Stock or Roll the Option?: A Real-Life Example with Tesla, Inc. (Nasdaq: TSLA)

Jun 24, 2023 | Covered Call Exit Strategies, Exit Strategies, Investment Basics, Option Trading Basics, Stock Option Strategies

The crafting and managing of our covered call writing trades are directly dependent on our pre-defined goals. In this article, we will analyze a TSLA covered call trade where the strike was about to expire in-the-money (ITM) and exercise was inevitable if no action is...
How to Enter and Archive a Covered Call Trade with 1 Exit Strategy that is Closed at Expiration

How to Enter and Archive a Covered Call Trade with 1 Exit Strategy that is Closed at Expiration

Jun 17, 2023 | Covered Call Exit Strategies, Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Option Strategies

After entering our covered call trades, we immediately go into position management mode. Frequently, we can take advantage of a covered call exit strategy opportunity, sometimes more than one. This article will review a trade shared with me by Jim, where his covered...