Exit strategy opportunities may be created when there is a substantial 1-day market decline and we must be prepared to take advantage of these occasions. In June 2020, there was an 1800 point decline in the Dow 30 due to coronavirus concerns and national unrest related to police shootings. Many members of the BCI community […]

Rolling-Down On a Sharp Market Decline at the End of a Contract
Posted on January 9, 2021 by Alan Ellman in Covered Call Exit Strategies, Exchange-Traded Funds, Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Option Strategies

“Hitting a Double” on the Last Day of a Contract
Posted on November 21, 2020 by Alan Ellman in Covered Call Exit Strategies, Exchange-Traded Funds, Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Investing, Stock Option Strategies
Exit strategies for covered call writing are critical components to our overall success. One of the strategies available to us is hitting a double. This is where we buy back the short call and wait for the stock price to recover allowing us to re-sell the same option. This creates 2 income streams in the […]

Covered Call Writing with TLT: Generating Premium and Dividend Income
Posted on October 31, 2020 by Alan Ellman in Exchange-Traded Funds, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Option Strategies
The main goal of covered call writing is to generate option premium cash flow. Many investors also seek to develop dividend income in addition to the option premium revenue. One security that presents a unique scenario is iShares 20+ Year Treasury Bond ETF (NASDAQ: TLT). This exchange-traded fund produces dividend income twelve times a year with […]

Entering a Collar Trade: A Real-Life Example with iShares Silver Trust (NYSE: SLV) + New Product with Discount Coupon
Posted on August 15, 2020 by Alan Ellman in Exchange-Traded Funds, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Option Strategies
The collar strategy is a covered call writing-like strategy where a protective put is added to the covered call trade. In this article, the initial structuring of a collar trade will be highlighted using SLV, an eligible exchange-traded fund in our Premium ETF Report in August 2020. The 3-legs of a collar trade STOCK: […]

Bear Market Concerns and our Option-Selling Portfolios
Posted on July 4, 2020 by Alan Ellman in Exchange-Traded Funds, Option Trading Basics, Options Calculations, Put-selling, Stock Option Strategies
Covered call writing and selling cash-secured puts are stock option strategies with primary goals of income generation and capital preservation. Most of us are conservative investors who seek to beat the market on a consistent basis while minimizing portfolio risk. This is one of the mission statements of the BCI methodology. In the past few […]

Setting Up a Portfolio of NASDAQ and S&P 500 Stocks In a User-Friendly and Time-Efficient Manner + New Products and Discount Coupons
Posted on June 6, 2020 by Alan Ellman in Exchange-Traded Funds, Option Trading Basics, Options Calculations, Stock Option Strategies
Many covered call writers and put-sellers favor a portfolio mix of blue-chip and tech companies and turn to the S&P 500 and the Nasdaq exchange for locating the best underlying securities. Since this benchmark and exchange total nearly 4000 stocks, locating an elite portfolio can be an overwhelming task. This article will present an approach […]

Adjusting Target Goals with ETFs
Posted on May 2, 2020 by Alan Ellman in Exchange-Traded Funds, Investment Basics, Option Trading Basics, Options Calculations, Stock Option Strategies, Technical Analysis
Exchange-traded funds are baskets of stocks some going up and others going down in price. Generally, this makes these securities less volatile than individual stocks. Lower implied volatility translates into lower option premiums. Of course, there are exceptions but covered call writing with ETFs will usually provide better diversification and less risk at the expense […]

Dividend Yield Should Be a Secondary Factor When Selecting Stocks for Our Covered Call Writing Portfolio
Posted on April 25, 2020 by Alan Ellman in Exchange-Traded Funds, Fundamental Analysis, Investment Basics, Option Trading Basics, Stock Option Strategies, Technical Analysis
Combining covered call writing premiums with high dividend yields can be an enticing investment approach. In October 2019, Gerry wrote to me about using MPLX LP (NYSE: MPLX) in her option-selling portfolio and pointed to the generous dividend yield and real-estate component as the reasons for this consideration. In the BCI methodology, we use fundamental […]

Mid-Contract Unwind Exit Strategy at the End of a Contract
Posted on April 11, 2020 by Alan Ellman in Covered Call Exit Strategies, Exchange-Traded Funds, Exit Strategies, Investment Basics, Option Trading Basics, Options Trade Execution, Stock Option Strategies
Exit strategies for covered call writing and sell cash-secured puts is one of the 3-required skills that must be mastered. The mid-contract unwind (MCU) exit strategy is used for covered calls when share price moves substantially above the strike price, leaving the strike deep in-the-money. One of the characteristics of a deep ITM strike is […]

Is This Trade a Winner or a Loser?: A Real-Life Example with XLE
Posted on December 21, 2019 by Alan Ellman in Covered Call Exit Strategies, Exchange-Traded Funds, Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Option Strategies
Covered call writers must understand and evaluate the success (or lack thereof) of our trades. Simply stated, are they winners or losers? In June 2019, Van shared with me trades he executed with the exchange-traded fund (ETF), Energy Select Sector SPDR Fund (NYSE: XLE). He was trying to categorize his trade as a winner or […]
Podcast
- 50. Exit strategies Must Be Timed Properly
- 49. Analyzing a Multi Leg Covered Call Rolling Down Series of Trades
- 48. Rolling Deep OTM Cash Secured Puts
- 47. Rolling Up in the Same Contract Month
- 46. Should Delta Be the Sole Criteria for Covered Call Writing Strike Selection
- 45. Implied Volatility and Expected price Movement During the Life of Option Contracts
- 44. Can We Use ITM Strikes to Create a No Risk Covered Call Strategy?
- 43. Converting a Covered Call Trade to a Collar Trade
- 42. Why Was My OTM Put Exercised?
- 41. Collar Trades When Call Strikes Move Deep In The Money
Subscribe To Our Free Newsletter
Categories
- Ask Alan (14)
- Covered Call Exit Strategies (155)
- Exchange-Traded Funds (44)
- Exit Strategies (138)
- Fundamental Analysis (31)
- Investment Basics (419)
- Just Alan (6)
- Option Trading Basics (430)
- Options Calculations (274)
- Options Trade Execution (97)
- paper trading (3)
- Podcasts (41)
- Put-selling (58)
- Stock Investing (105)
- Stock Option Strategies (397)
- Stock Trading & Taxes (18)
- Technical Analysis (40)
- Uncategorized (16)
Recent Posts
Premium Membership
Why Covered Call Options May Be Your Best Investing Strategy
Nasdaq Interviews Alan Ellman
© 2020 The Blue Collar Investor. All Rights Reserved.
Beginners Corner Enhanced & Updated
- Lesson 1: Beginner's Corner for Covered Call Writing: 2nd Edition
- Lesson 2: Beginner's Corner for Covered Call Writing- 2nd Edition: Option Basics
- Lesson 3: Beginner's Corner for Covered Call Writing- Stock Selection
- Lesson 4: Beginner's Corner for Covered Call Writing-2nd Edition
- Lesson 5: Beginner's Corner for Covered Call Writing
- Lesson 6: Beginner's Corner for Covered Call Writing
- Lesson 7: Beginner's Corner for Covered Call Writing: 2nd Edition
- Lesson 8: Beginner's Corner for Covered Call Writing
- Video 9: Premium Membership
Beginners Corner Selling-Puts
- Lesson 1: What Is Puts Selling?
- Lesson 2: Puts-Selling Option Basics
- Lesson 3:puts-selling-technical analysis
- Lesson 4:puts-selling-Common Sense Considerations
- Lesson 5:puts-selling-Calculating Returns
- Lesson 6:puts-selling-Executing Put-Selling
- Lesson 7:puts-selling- Exit Strategies
- Lesson 8:puts-selling-Mastering Put-Selling
Recent Comments