Jun 22, 2013 | Investment Basics, Option Trading Basics, Stock Option Strategies
Several studies have been undertaken to determine the effectiveness of the covered call writing strategy. I believe that it is important to evaluate the parameters that are used as well as how they are employed in these evaluations to assess the accuracy of the...
Jun 15, 2013 | Investment Basics, Option Trading Basics, Options Calculations, Stock Option Strategies
Every so often we will see a company declare a “special dividend” which is separate from the typical recurring dividend cycle, if there is one. It is frequently a reflection of exceptionally strong earnings and/or a company with a large cash balance. It is a positive...
Jun 1, 2013 | Covered Call Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Stock Option Strategies
Mastering covered call writing requires us to learn from our mistakes and not repeating them. We can then utilize a series of guidelines and rules that will guide us to the highest possible returns with the least amount of risk. Maximizing profits with capital...
May 25, 2013 | Investment Basics, Option Trading Basics
In the BCI methodology for covered call writing we use predominantly 1-month options. The reasons are as follows: Generate the highest annualized returns Allows us to avoid earnings reports, a key rule in the BCI methodology Keep our obligation to a short-term time...
May 4, 2013 | Option Trading Basics, Options Calculations, Stock Investing, Stock Option Strategies
Innovative covered call writers can develop ideas of implementing a strategy in unconventional ways. For example, we can invest in a money market or CD and perhaps not even beat the inflation rate with those dividends. We can buy a quality bond and wait six months to...
Apr 27, 2013 | Option Trading Basics, Options Calculations, Stock Option Strategies
Covered call writing entails buying a stock and then selling an option. But what if I buy a call option instead of the stock and then sell a call option on that option? I’ll be spending less money than the outright purchase of the equity and still generate cash from...
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