Jul 29, 2017 | Covered Call Exit Strategies, Exit Strategies, Investment Basics, Option Trading Basics, Stock Option Strategies, Technical Analysis
Covered call writing generates monthly (or weekly) cash flow but it also reduces our cost basis. The latter result is the reason why covered call writing increases our chances of a successful trade more so than simply owning the stock. Historical data tells us that in...
Jul 1, 2017 | Fundamental Analysis, Investment Basics, Option Trading Basics, Options Calculations, Stock Option Strategies, Technical Analysis
Covered call writing and put-selling candidates must pass a series of fundamental, technical and common-sense screens in order to be considered eligible for our portfolios. In early January 2017, one of our members, Jim W, asked about using Ford Motor Corp. (F), a...
Jun 3, 2017 | Investment Basics, Option Trading Basics, Options Calculations, Stock Option Strategies, Technical Analysis
When selling covered call or put options, strike price selection is one of the three required skills. Here are the main factors we evaluate when determining which strike price to select: Overall market assessment Personal risk tolerance Return goals Technical price...
Mar 25, 2017 | Covered Call Exit Strategies, Exit Strategies, Option Trading Basics, Stock Investing, Stock Option Strategies, Technical Analysis
The BCI methodology requires fundamental analysis, technical analysis and common sense screening (like minimum trading volume and avoiding earnings reports). One of the most difficult decisions retail investors face is when to sell a stock that has depreciated in...
Jan 21, 2017 | Investment Basics, Option Trading Basics, Stock Investing, Stock Option Strategies, Technical Analysis
Technical analysis represents one third of the stock screening process in the BCI methodology. The other two are common sense principles (referred to as “descriptive terms for long-term investing) and fundamental analysis. Reading price charts is as much an art...
Mar 26, 2016 | Investment Basics, Option Trading Basics, Options Calculations, Stock Option Strategies, Technical Analysis
When selecting stocks and options for covered call writing and put-selling we factor in volatility, both implied and historical. Historical Volatility (HV) is the actual volatility of a security over a given time period. HV is calculated by determining the average...
Podcast