8 matching records.
the market is expected to correct
It's better to sell covered calls when the stock is down for the day, as it allows for higher volatility and better pricing. Selling puts into weakness is also preferred.
Research shows that adjusting the strike to a lower cost basis can provide more protection as the market moves down.
The speaker is against selling an out of the money December 2028 covered call for buying power relief, stating that it doesn't provide any relief and is not a good idea. They suggest selling a put instead.
It's a sound market strategy if the market cooperates, but there are risks such as market movement, fees, and the use of margin. It's not guaranteed and may not be suitable for all account sizes.
IVR (Implied Volatility Ratio) doesn't matter for a covered call strategy on existing stock holdings because the focus is on the direction of the stock. However, higher IVR can lead to higher premiums, which is a benefit.
If the call is in the money and the stock is above the strike, the profit is already realized. If the trader wants to keep the stock, they can do nothing and the position will expire. If they want to continue the position, they can buy back the call and sell another one.
The speaker suggests selling a covered call at the money if the trader is bullish and wants to keep the stock. If the trader is less bullish but still wants to hold the stock, selling a covered call out of the money is recommended. The reasoning is that at-the-money calls provide more premium, while out-of-the-money calls offer more room for the stock to move upward.