Sep 5, 2020 | Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Option Strategies
Covered call writing trades can be entered by legging-in (buy stock and then sell option) or as a buy/write trade (one net debit limit order). In the latter order, the option premium is deducted from the stock price and the broker is required to execute the trade and...
Aug 29, 2020 | Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Put-selling, Stock Option Strategies
Selling cash-secured puts is a strategy similar to, but not precisely the same, as covered call writing. In February 2020, Chevy wrote to me asking for an article or video addressing weekly cash-secured puts, a strategy he was using and looking to enhance. The...
Aug 22, 2020 | Covered Call Exit Strategies, Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Option Strategies
Recognizing successful covered call writing trades is just as important as executing them. On January 17, 2020, Mark wrote to me about a covered call trade that he was analyzing with SolarEdge Technologies, Inc. (NASDAQ: SEDG). He was concerned that if he bought back...
Aug 15, 2020 | Exchange-Traded Funds, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Option Strategies
The collar strategy is a covered call writing-like strategy where a protective put is added to the covered call trade. In this article, the initial structuring of a collar trade will be highlighted using SLV, an eligible exchange-traded fund in our Premium ETF Report...
Aug 1, 2020 | Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Option Strategies
Portfolio overwriting is a covered call writing alternative strategy. Our goals include increasing our returns by a modest amount while still retaining ownership of the shares. Deep out-of-the-money strikes are sold with specific annualized returns in mind,...
Jul 25, 2020 | Covered Call Exit Strategies, Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Stock Option Strategies
Exit strategies for covered call writing will frequently allow us to convert losing trades to profitable ones. To corroborate this concept, a real-life example with Nike Inc. (NYSE: NKE) will be detailed. Initial trade structuring On 6/22/2020, 200 shares of...
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