Sep 1, 2018 | Covered Call Exit Strategies, Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Stock Option Strategies
Rolling our covered call trades involves multiple months of trading statistics. The calculations may be deceiving initially but on deeper analysis, rolling our options can represent an invaluable trading tool which enhances our overall returns. Some of our members...
Aug 25, 2018 | Exit Strategies, Investment Basics, Option Trading Basics, Stock Option Strategies
When we write a covered call option we are obligated to sell our shares at any time from the option sale to contract expiration if the option buyer decides to take possession of our shares. This is because we are dealing with American Style options. European Style...
Aug 18, 2018 | Covered Call Exit Strategies, Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Option Strategies
Exit strategies for covered call writing includes closing a trade when share price rises above the original strike price sold. When formulating these decisions, we must factor in the cost-to-close as it relates to the opportunity to generate more profit. On November...
Aug 11, 2018 | Covered Call Exit Strategies, Exit Strategies, Fundamental Analysis, Investment Basics, Option Trading Basics, Options Calculations, Stock Investing, Stock Option Strategies
Exit strategy preparation and implementation is one of the 3 required skills for successful covered call writing and put-selling. Because of the time value erosion of our options (Theta), there are limitations regarding the exit strategy opportunities as our contracts...
Aug 4, 2018 | Investment Basics, Option Trading Basics, Options Calculations, Stock Option Strategies
Whenever a covered call trade results in a maximum return, it is a successful trade…period…end of story. To most, this statement appears nonsensical and self-evident. But I’m here to tell you that there are a lot of covered call writers that question...
Jul 28, 2018 | Investment Basics, Option Trading Basics, Stock Investing, Stock Option Strategies
For covered call writers and put-sellers, the option Greeks play a major role in our understanding of the risks and value of our option premiums. We know our option premiums consist of intrinsic value (for in-the-money strikes) + time value. Our initial time value...
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