Contract adjustments to the terms of our covered call writing and put-selling options are due to corporate actions like mergers and acquisitions, special dividends and stock splits. This article will highlight the contract alterations resulting from special dividends and equity distributions. Special cash dividends: 2 adjustment techniques 1. Ticker remains unchanged Number of […]

What Do Covered Call Writing and Steroids Have in Common?
Most investors view covered call writing as a singular strategy where we buy a stock and then sell an option leveraging that security. In reality, educated option-sellers realize that one of the most remarkable advantages of using this strategy is that it can be crafted to achieve multiple goals and meet the trading style and […]

Myths and Misunderstandings About Covered Call Writing
Covered call writing education must include debunking the myths associated with this strategy. When certain concepts are repeated often enough, they become accepted as truths whether they are accurate or false. The purpose of this article is to refute five of the most egregious of these misrepresentations. 1. Covered call writing should be used […]

Technical Charts: A Picture is Worth 1000 Words- A Real-Life Example with The Wendy’s Company (NASDAQ: WEN)
Technical analysis is one of the 3 screens we use for stock selection when selling options. The other two are fundamental analysis and common-sense principles (like minimum trading volume). In August 2019, Nick wrote to me about a trade opportunity he thought he missed with WEN. He attached a technical chart followed by a question. […]
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