Stop buying calls, do this instead

Covered Call Strategy for Cost Basis Reduction

A covered call strategy involves buying stock and selling an out-of-the-money call option. This reduces the effective cost basis of the stock. For example, buying a stock at $100 and selling a 105 call for $2 reduces the cost basis to $98. This makes the stock more profitable as it needs to rise less to generate gains. The strategy is useful for investors looking to lower their cost basis and increase potential returns.

What is a covered call strategy?

A covered call strategy involves buying a stock and selling an out-of-the-money call option. This reduces the cost basis of the stock, making it more profitable as the stock price needs to rise less to generate gains.

TakeawayThis strategy is useful for investors looking to lower their cost basis and increase potential returns.