Mar 22, 2014 | Investment Basics, Option Trading Basics, Options Calculations, Stock Option Strategies
Meaningful option calculations are essential in determining if the premiums meet our goals. To this end, we must understand the mathematics of these calculations to become elite covered call writers. Now don’t worry…we don’t have to become Albert...
May 18, 2013 | Covered Call Exit Strategies, Options Calculations, Options Trade Execution, Stock Option Strategies
Exit strategy execution is a critical skill every covered call writer should master. In addition to managing positions where share price has decreased there are also situations where we can benefit when price has dramatically accelerated. Let’s look at a trade...
Aug 18, 2012 | Investment Basics, Option Trading Basics, Options Calculations
In last week’s article concerning option trading basics I highlighted the in-the-money strike in our covered call writing strategy. In this article I will expand our options calculations to all three types of strike prices. First, let’s review each of...
Mar 10, 2012 | Options Calculations
Selling stock options is all about generating a cash flow. Calculating our initial profit, the potential for more profit (upside potential) and the protection of our initial profit (downside protection as opposed to breakeven of the entire position) is critical in...