May 25, 2013 | Investment Basics, Option Trading Basics
In the BCI methodology for covered call writing we use predominantly 1-month options. The reasons are as follows: Generate the highest annualized returns Allows us to avoid earnings reports, a key rule in the BCI methodology Keep our obligation to a short-term time...
May 4, 2013 | Option Trading Basics, Options Calculations, Stock Investing, Stock Option Strategies
Innovative covered call writers can develop ideas of implementing a strategy in unconventional ways. For example, we can invest in a money market or CD and perhaps not even beat the inflation rate with those dividends. We can buy a quality bond and wait six months to...
Apr 27, 2013 | Option Trading Basics, Options Calculations, Stock Option Strategies
Covered call writing entails buying a stock and then selling an option. But what if I buy a call option instead of the stock and then sell a call option on that option? I’ll be spending less money than the outright purchase of the equity and still generate cash from...
Apr 21, 2012 | Option Trading Basics
When studying option trading basics, we learn that options expire on the third Friday of the month. In the BCI methodology we sell mainly 1-month stock options. When we view an options chain we see several other expirations available. However, they are not the same...
Jul 16, 2011 | Stock Option Strategies
Wait a minute! What if I buy a call option instead of the stock and then sell a call option on that option? I’ll be spending less money than outright purchase of the equity and still generate cash from the sale of the call option! This idea has come to many of you and...
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