Why make 2.6% holding the 10-Year note? Selling a covered-call, also known as buy-write, is the only strategy the OCC considers to be â€˜non-speculative. Learn the ins and outs of this strategy through this comprehensive course. Learn how to calculate risk, reward and breakeven levels using this strategy. Learn how a trader should select strikes to sell and how to know a good setup when one presents itself.
This is a great strategy for an investor or anyone who does not want to watch their bank yield them 0.4% annually and wants to create an extra dividend stream in an underlying stock.
Interested in generating additional monthly income from equity investments?
Want to sell options but concerned with trading an aggressive, speculative strategy?
Selling a covered call, also known as a buy-write, is the only strategy to be considered non-speculative by the Options Clearing Corporation (OCC). As more experienced options traders will know, a covered call is a synthetic short put, meaning the strategy has the same risk-reward profile as that of a short put.
In the latest KOTM exclusive workshop Covered Call Strategies for Up, Down, or Flat Markets, Keene looks at how traders and investors can setup the best buy-writes:
How to read order flow for covered call setups
What stock or chart types should one avoid for covered calls
Why covered calls can generate monthly (or even weekly) income regardless of overall market direction
Why covered calls are superior to other â€˜conservativeâ€™ strategy types, and can yield 6-10% monthly for annualized returns over 100%