The main reason for early exercise of our covered call writing options relates to corporate dividends. The key date to be aware of is the ex-dividend date. This article will clarify and define the dates related to corporate dividends and also discuss an anomaly related to special dividends. Early exercise of our covered call […]

Review of Dividend Dates & Their Impact on Our Covered Call Trades
Posted on February 18, 2023 by Alan Ellman in Fundamental Analysis, Investment Basics, Option Trading Basics, Stock Investing, Stock Option Strategies

Comparing Nasdaq 100 ETFs: Real-Life Examples with QQQ & QQQM
Posted on August 27, 2022 by Alan Ellman in Exchange-Traded Funds, Fundamental Analysis, Investment Basics, Option Trading Basics, Options Calculations, Stock Option Strategies
Over the years, the most frequently used ETF in my portfolios has been Invesco QQQ Trust (Nasdaq: QQQ). Premium members have noticed that, lately, a relatively new eligible security in our Premium Members ETF Reports has been QQQM (Invesco Nasdaq 100 ETF). Both are based on the Nasdaq 100 Index. This article will highlight the […]

What is a Delta-Neutral Portfolio?: A Real-Life Example With InMode Ltd. (Nasdaq: INMD) + Free Webinar Registration Links
Posted on March 12, 2022 by Alan Ellman in Fundamental Analysis, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Option Strategies
Many portfolio managers will seek Delta-neutral portfolios to mitigate directional or market risk. This article will explain how these experts calculate their positions to achieve this goal. To simplify the details, a single security will be used but the concepts apply to total portfolio positions as well. Definitions Delta: The amount an option value […]

Understanding 1-Time Special Cash Dividends and Our Current Trade Status: A Real-Life Example with OMF
Posted on January 15, 2022 by Alan Ellman in Fundamental Analysis, Investment Basics, Option Trading Basics, Options Trade Execution, Stock Option Strategies
Contract adjustments will change the parameters of our covered call writing and put-selling trades but will not result in any trade loss or gain. The Options Clearing Corporation (OCC) will make alterations to our option contracts such that buyers and sellers of calls and put are made whole after the corporate event. On August 6, […]

Comparing Implied Volatility and Delta When Establishing Projected Trading Ranges During Our Option Contracts
Posted on January 8, 2022 by Alan Ellman in Fundamental Analysis, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Put-selling, Stock Option Strategies
In 2020, BCI developed 2 ultra-low-risk option strategies, one using implied volatility and the other using Delta to establish low- and high-end trading ranges during our covered call writing and put-selling option contracts. We will use 5 real-life examples to analyze the trading ranges predicted by each approach. The data was taken on 8/30/2021 for […]

Holding a Stock Through an Earnings Report Can Result in Impressive Returns: A Real-Life Example with Crocs, Inc. (Nasdaq: CROX)
Posted on December 11, 2021 by Alan Ellman in Covered Call Exit Strategies, Exit Strategies, Fundamental Analysis, Investment Basics, Option Trading Basics, Options Calculations, Stock Option Strategies
One of the golden rules of the BCI methodology is never to sell an option (call or put) when there is an earnings report due out prior to contract expiration. Most of the time we avoid holding these securities in our option-selling portfolios due to the risk inherent in these reports. However, there are exceptions […]

Should Good News Discourage Us From Entering a Covered Call Trade?
Posted on October 23, 2021 by Alan Ellman in Fundamental Analysis, Investment Basics, Option Trading Basics, Stock Investing, Technical Analysis
We examine the BCI Premium Stock Report on the Sunday May 23, 2021, after expiration Friday, for our Monday trade selections. One of the securities we choose is Applied Materials, Inc. (Nasdaq: AMAT). On Monday morning, May 24th, AMAT gaps up well above the price movement of the S&P 500. Is AMAT now too expensive? […]

Best Technology ETFs for Our Option-Selling Portfolios: QQQ and XLK
Posted on October 9, 2021 by Alan Ellman in Exchange-Traded Funds, Fundamental Analysis, Investment Basics, Option Trading Basics, Stock Option Strategies, Technical Analysis
When seeking to add a technology presence to our covered call writing and put-selling portfolios, we can do so by using exchange-traded funds (ETFs) based on technology benchmarks. Two such reliable ETFs are Technology Select Sector SPDR Fund (NYSE: XLK) and Invesco QQQ Trust (Nasdaq: QQQ). This article will compare the 2 funds to assist […]

Using Delta to Create Low-Risk/ High-Return Put-Selling Trades: A Real-Life Example with ETSY, Inc. (NASDAQ: ETSY)
Posted on May 22, 2021 by Alan Ellman in Fundamental Analysis, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Put-selling, Stock Option Strategies
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 discount and have those shares put to us sooner rather than later. There are times […]

How to Set Up a Portfolio of Nasdaq and S&P 500 Stocks in a User-Friendly Approach
Posted on May 8, 2021 by Alan Ellman in Exchange-Traded Funds, Fundamental Analysis, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Investing, Stock Option Strategies, Technical Analysis
Covered call writers and sellers of cash-secured puts know the importance of portfolio diversification. If one security under-performs, the others can compensate. This article will demonstrate how to craft a portfolio of large-cap tech and blue-chip companies for our option-selling strategies. Strategy goals Portfolio mix of blue-chip and technology companies User-friendly system Broad diversification […]
Podcast
- 104. Special 1 Time Dividends and Contract Adjustments
- 103. The Collar Strategy Using Long-Term Put Expirations
- 102. Analyzing Market Assessment Based on Portfolio Setup
- 101. Covered Call Writing: "Hitting a Double" on the Last day of a Contract
- 100. Analyzing LEAPS for The Poor Man's Covered call Strategy (PMCC)
- 99. Anatomy of a Reverse Stock Split
- 98. Analyzing LEAPS Options for the Poor Man's Covered Call
- 97. Managing Our Poor Man's Covered Call Trades When Share Price Drops Substantially
- 96. Protecting Our Covered Call Trades: Protective Puts and In-the-Money Strikes
- 95. Covered Call Writing to Generate Premium and Dividend Income
Subscribe To Our Free Newsletter
Categories
- Ask Alan (14)
- Covered Call Exit Strategies (214)
- Exchange-Traded Funds (61)
- Exit Strategies (208)
- Fundamental Analysis (44)
- Investment Basics (537)
- Just Alan (6)
- Option Trading Basics (551)
- Options Calculations (375)
- Options Trade Execution (197)
- paper trading (4)
- Podcasts (106)
- Put-selling (84)
- Stock Investing (114)
- Stock Option Strategies (504)
- Stock Trading & Taxes (19)
- Technical Analysis (47)
- Uncategorized (20)
Recent Posts
- Evaluating a Series of Multi-Rolling Covered Call Trades: A Real-Life Example with Elevance Health Inc. (NYSE: ELV)
- BCI PODCAST 104: Special 1 Time Dividends and Contract Adjustments
- Analyzing a Covered Call Trade Over 2 Expiration Cycles: A Rea-Life Example with Interactive Brokers Group (Nasdaq: IBKR)
- Multiple Applications of the Mid-Contract Unwind (MCU) Exit Strategy: A Real-Life Example with Super Micro Computer, Inc. (Nasdaq: SMCI)
Premium Membership
How Alan Got Started with Stock Options
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