Most investors view covered call writing as a singular strategy where we buy a stock and then sell an option leveraging that security. In reality, educated option-sellers realize that one of the most remarkable advantages of using this strategy is that it can be crafted to achieve multiple goals and meet the trading style and personal risk-tolerance of a wide range of investors.

Given my medical background, this reality made me think of steroids, an anti-inflammatory that has so many uses. This miracle drug can be utilized to treat arthritis, bone diseases, gout, muscle diseases, blood diseases and so much more. To think of steroids as simply a drug that decreases inflammation is not doing it justice. In this same regard, this article will summarize some of the ways covered call writing can be designed to meet the needs and goals of a wide range of investors.



Covered Call Writing: The Steroid for Investors

 

The many uses of covered call writing summarized (hot links provided for products and more information)

  • Traditional covered call writing: We buy a stock and sell an option using stock selection, option selection and position management as the 3-required skills needed to get started. Our portfolios turn over frequently.

 

 

 

 

  • Covered call writing with ETFs: A more conservative approach to covered call writing using less volatile securities requiring less capital investment to achieve appropriate diversification.

 

  • Covered call writing to create a FREE portfolio of large-cap tech companies: Covered call writing blue-chip (Dow 30) stocks to purchase shares of Invesco QQQ Trust.

 

 

  • Stock repair strategy: Sell call options against both shares and long calls to reduce the breakeven price point when stock prices are in losing positions.

 

Discussion

Covered call writing, much like steroids to patients, can be tailored to meet the needs of investors in a myriad of situations. Limiting its application is not doing justice to the potential this strategy offers to those of us seeking to become CEO of our own money and ultimately to achieve financial independence.

 

Free webinar

I have cancelled all my in-person presentations through the end of the year due to the coronavirus crisis. To keep in touch with our members, we have decided to provide our BCI community with a free webinar in August. Feel free to send in topic ideas and suggestions. Send to: [email protected]

 

FREE WEBINAR JUST ADDED Thursday August 13th

 

LOGIN INFORMATION (no registration required)

Alan Ellman is inviting you to a scheduled Zoom meeting.

Topic: FREE WEBINAR Hosted by The Blue Collar Investor

Time: Aug 13, 2020 08:00 PM Eastern Time (US and Canada)

Join Zoom Meeting

https://zoom.us/j/93386560621

Meeting ID: 933 8656 0621

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Meeting ID: 933 8656 0621

 

Find your local number: https://zoom.us/u/ad6BluRQRH

 

Investment club program board members

If you would like to schedule a private webinar with Alan and Barry, send an email to:

[email protected]

Include:

  • Contact email
  • Contact phone #
  • Club website URL
  • Put “private webinar” in the header

 

Your generous testimonials

Over the years, the BCI community has been incredibly gracious by sending our BCI team email testimonials sharing stories as to what our educational content has meant to their families. Moving forward, we have decided to share some of these testimonials in our blog articles. We will never use a last name unless given permission:

Hi Alan,

I want to tell you that your premium membership and all your teachings are fantastic! I have tried many other option sites, but yours explains the concepts very clearly and thoroughly using examples. Also, the premium membership is very affordable. I hope to be very successful making money using your techniques.

Thanks for offering this information to investors like me.

Raj

 

Upcoming event

Private webinar (California investment club)

Covered Call Writing with 4 Practical Applications

Saturday September 17th

9 AM – 12PM PT

 

Alan speaking at a Money Show event

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Market tone data is now located on page 1 of our premium member stock reports and page 1 of our mid-week ETF reports.

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