beginners corner
Tag Archives: delta-neutral

The Collar Strategy from a Delta Perspective

When covered call writing is combined with protective puts the strategy is known as the collar strategy. The short call places a ceiling on gains and the long put represents […]

52 Comments Continue Reading →
covered call writing option premiums

Exercise Of Options From The Call Buyer’s Perspective

Since we are selling call and put options we know there are traders or market makers who are buying them. In this article we will explore why only about 10% […]

21 Comments Continue Reading →
calculating Delta for covered call writing

Using Delta to Determine the Amount of Risk in Our Option-Selling Positions

Covered call writing and selling cash-secured puts are low-risk option-selling strategies used to generate monthly cash flow. Low-risk does not mean no risk so how can we measure the degree […]

22 Comments Continue Reading →
The Greeks and covered call writing

Delta Defined from Three Perspectives

Delta, one of the major Greeks, correlates the relationship between stock price and option value. Option traders use the Greeks to evaluate the risk inherent in our positions and Delta is […]

25 Comments Continue Reading →
beta and covered call writing

What is Beta-Weighting?

What is the impact on the overall market on our covered call writing and put-selling positions? We know that market movement plays a major role in our stock and options […]

16 Comments Continue Reading →
Explaining "pinning the strike"

“Pinning the Strike”: A Covered Call Writing Consideration

When considering covered call exit strategies on or near expiration Friday we compare the market price of our stock to the strike price sold. If the share value is even […]

16 Comments Continue Reading →