Aug 12, 2017 | Investment Basics, Option Trading Basics, Stock Option Strategies
“What is the best Delta to use when selling covered call options?” I get this question frequently from the educated core of members from our BCI community. Delta is one of the five option Greeks which are mathematical means of quantifying the risk...
Aug 5, 2017 | Covered Call Exit Strategies, Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Option Strategies
Covered call writing exit strategies include scenarios when share price moves up or down. Our main enemy is share depreciation where we need to mitigate losses but we must also have the ability to enhance returns when share price rises under certain specific...
Jul 29, 2017 | Covered Call Exit Strategies, Exit Strategies, Investment Basics, Option Trading Basics, Stock Option Strategies, Technical Analysis
Covered call writing generates monthly (or weekly) cash flow but it also reduces our cost basis. The latter result is the reason why covered call writing increases our chances of a successful trade more so than simply owning the stock. Historical data tells us that in...
Jul 22, 2017 | Investment Basics, Option Trading Basics, Stock Investing, Stock Option Strategies
We know to avoid earnings reports when writing covered calls or selling puts. This is easily accomplished because we have a reliable idea when those reports will become public. Premium members can access these dates directly from our weekly reports here: Those...
Jul 15, 2017 | Covered Call Exit Strategies, Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Put-selling
Selling options (covered call writing and selling cash-secured puts) will result in a positive outcome in the first four of the following five scenarios: Stock price moves up significantly Stock price moves up slightly Stock price remains the same Stock price moves...
Jul 8, 2017 | Investment Basics, Option Trading Basics, Options Calculations, Stock Investing, Stock Option Strategies, Stock Trading & Taxes
Covered call writing is a short-term strategy where we sell Weekly or Monthly options to generate cash flow. It is best to use this strategy in sheltered accounts to defer or eliminate tax consequences but that is not always possible. Generally, the income from...
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