May 7, 2016 | Investment Basics, Option Trading Basics, Stock Option Strategies
Covered call writing is applicable only in neutral to slightly bullish market environments”. We’ve heard this proclamation time and time again and so it has become accepted as fact to a majority of option-sellers. In this article, we will examine the...
Apr 30, 2016 | Investment Basics, Option Trading Basics, Options Calculations, Put-selling, Stock Option Strategies
Strike price selection can be tailored to our covered call writing and put-selling trades based on overall market assessment. In bear and volatile market conditions we favor in-the-money calls and deeper out-of-the-money puts (lower than current market value). In this...
Apr 16, 2016 | Investment Basics, Option Trading Basics, Options Calculations, Put-selling
Covered call writing and selling cash-secured puts are similar strategies that do have certain differences. In my book, Selling Cash-Secured Puts, Figure 68 on page 214 highlights the similarities and differences between these two strategies. In this article, I will...
Apr 2, 2016 | Investment Basics, Option Trading Basics, Put-selling, Stock Option Strategies
We sell a covered call or cash-secured put and then the underlying company files for bankruptcy. What happens next? How are our positions effected? Let me premise my remarks by saying how unlikely this scenario is for investors who follow the rigorous screening...
Jan 2, 2016 | Exchange-Traded Funds, Investment Basics, Option Trading Basics, Stock Option Strategies
One of the three required skills for covered call writing and put-selling is the selection of the underlying security. Along with this we also must avoid quarterly earnings reports. Since most corporations report earnings in similar time frames (known as earnings...
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