Exit strategy opportunities may be created when there is a substantial 1-day market decline and we must be prepared to take advantage of these occasions. In June 2020, there was […]

Rolling-Down On a Sharp Market Decline at the End of a Contract
Posted on January 9, 2021 by Alan Ellman in Covered Call Exit Strategies, Exchange-Traded Funds, Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Option Strategies

The Poor Man’s Covered Call: Rolling Options in the Current Contract Month + 15% Holiday Discount Expiring Soon
Posted on December 19, 2020 by Alan Ellman in Covered Call Exit Strategies, Exit Strategies, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Option Strategies
Exit strategies are critical to our overall success whether using traditional covered call writing or the Poor Man’s Covered Call (PMCC). In this article, we will evaluate scenarios when share […]

Covered Call Writing Quiz: Evaluating a Series of Trades
Posted on January 18, 2020 by Alan Ellman in Covered Call Exit Strategies, Exit Strategies, Option Trading Basics, Options Calculations, Stock Option Strategies
Managing our covered call positions is essential to our overall option-trading success. In July 2019, KA Lau shared with me a series of questions he developed based on a real-life […]

Interpreting Exit Strategy Calculations Versus Final Calculations
Posted on July 13, 2019 by Alan Ellman in Covered Call Exit Strategies, Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Stock Option Strategies
Mastering option calculations is an essential skill needed to attain the very highest covered call writing returns. Although the Ellman Calculator will do most of the heavy lifting for us, […]

Analyzing a Rolling Down Trade During an Extreme Short-Term Market Decline
Posted on April 13, 2019 by Alan Ellman in Covered Call Exit Strategies, Exit Strategies, Investment Basics, Option Trading Basics, Options Trade Execution, Stock Option Strategies
Exit strategy opportunities must be taken advantage of with our covered call writing and put-selling trades. When there is a significant overall market decline in the short-term, there will be […]

Multi-Leg Option Trades: Understanding Calculations and Results
Posted on November 24, 2018 by Alan Ellman in Covered Call Exit Strategies, Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Stock Option Strategies
Covered call writing involves a minimum of 2 legs: we are long the stock (own the stock) and short the option (sold the option). There are many times when we […]

Rolling Down Our Put Positions: When and Why?
Posted on July 14, 2018 by Alan Ellman in Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Put-selling, Stock Option Strategies
Rolling Down Our Put Positions: When and Why? When selling cash-secured puts, our breakeven stock price is the (out-of-the-money) strike price less the put premium. Our exit strategy guideline […]

Setting Stop Loss Orders for Covered Call Writing
Posted on January 27, 2018 by Alan Ellman in Covered Call Exit Strategies, Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Stock Option Strategies
After entering our covered call writing trades, we immediately go into position management mode. For most of us who started our stock investment careers buying and selling stock, this may […]

Mitigating Losses After a Disappointing Earnings Pre-Announcement
Posted on November 11, 2017 by Alan Ellman in Covered Call Exit Strategies, Exit Strategies, Fundamental Analysis, Investment Basics, Option Trading Basics, Options Calculations, paper trading, Stock Option Strategies
A critical BCI rule for covered call writing is never to sell an option if there is an upcoming earnings report prior to contract expiration. Earnings reports are risky events […]

Exit Strategy Selectivity: Can We Implement Too Many Exit Strategies?
Posted on February 4, 2017 by Alan Ellman in Covered Call Exit Strategies, Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Stock Option Strategies
Covered call writers, historically, have ignored exit strategies as part of their investment approach. Certainly, not in the BCI community but most everywhere else. As we become aware of the […]
Podcast
- 114. The Poor Man's Covered Call Selecting the Best LEAPS Strikes
- 113. How to Select the Best Strikes for Collar Trades
- 112. Using Covered call Options and Stock Dividends in Low Interest Rate Environments
- 111. Rolling Down on a Sharp Market Decline at the end of a Contract
- 110. Exit Strategies Are Important But Must Be Timed Properly
- 109. Delta and Strike Selection for Covered call Writing
- 108. Establishing Our Cost Basis in a Multi Step Managed Trade
- 107: Even and Odd Stock Splits Understanding Contract Adjustments
- 106. "Hitting a Double" with Procter & Gamble: A Covered Call Writing Exit Strategy
- 105. The Poor Man's Covered Call: Rolling Options
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