Explaining “Bought-Up” Value When Rolling a Covered Call Out-And-Up

Explaining “Bought-Up” Value When Rolling a Covered Call Out-And-Up

Oct 16, 2021 | Covered Call Exit Strategies, Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Option Strategies

One of our key covered call writing exit strategies is rolling an option when the strike is in-the-money at expiration and we want to retain our shares. We can roll-out to the same strike at a later date or out-and-up to a higher strike at a later date. For both....
Selling Cash-Secured Puts to Simultaneously Generate Cash Flow and Buy a Stock at a Discount

Selling Cash-Secured Puts to Simultaneously Generate Cash Flow and Buy a Stock at a Discount

Sep 4, 2021 | Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Put-selling, Stock Option Strategies

Selling cash-secured puts is a low-risk option-selling strategy geared to generating cash flow and beating the market on a consistent basis. In certain scenarios an additional goal of buying the stock at a discount is added to traditional put-selling. This article...
Can Price Movement Be Explained by Profit-Taking?: A Real-Life Example with Global X Funds Infrastructure Dev. (PAVE)

Can Price Movement Be Explained by Profit-Taking?: A Real-Life Example with Global X Funds Infrastructure Dev. (PAVE)

Aug 21, 2021 | Covered Call Exit Strategies, Exchange-Traded Funds, Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Option Strategies, Technical Analysis

On April 8,2021, Nathan shared with me his covered call writing trade with PAVE which was initiated 3 days earlier. This exchange-traded fund had a strong technical chart but the price started declining immediately after the trade was entered. Nathan commented that he...