Aug 20, 2016 | Covered Call Exit Strategies, Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Put-selling, Stock Option Strategies
Covered call writing is a low-risk option-selling strategy that allows us to generate monthly cash flow in sheltered and non-sheltered accounts. One of the main reasons this has been the go-to strategy in the stock portion of my portfolio is related to the fact that...
Aug 13, 2016 | Covered Call Exit Strategies, Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Stock Option Strategies
Covered call writing and put-selling are strategies that require us to master three skills: stock selection, option selection and position management or the use of exit strategies. One of the exit strategies available to us as expiration approaches is rolling options...
Aug 6, 2016 | Covered Call Exit Strategies, Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Put-selling, Stock Option Strategies
Never sell a covered call or a cash-secured put if there is an upcoming earnings report. I will continue to repeat this mandate to ensure that new members will not suffer the financial fallout from a disappointing earnings report. There are times, however, when we...
Jul 30, 2016 | Covered Call Exit Strategies, Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Stock Option Strategies
Exit strategies for covered call writing are critical to the ultimate success we achieve when selling covered call options or cash-secured puts. One of the prime strategies associated with covered call writing when share price declines is the 20%/10% guideline. This...
Jul 16, 2016 | Covered Call Exit Strategies, Exit Strategies, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Option Strategies
Exit strategies for covered call writing and selling cash-secured puts all start with buying back the option. Frequently, the cost to close our short option positions will be less than the premium generated initially from the option sale. This is because of the impact...
Jul 2, 2016 | Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Put-selling, Stock Option Strategies
Selling out-of-the-money cash-secured puts is a fantastic way to buy a stock at a discount. It can be used in lieu of setting limit orders. If exercised, our cost basis is the put strike minus the put premium generated. If unexercised, we get paid not to buy the...
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