Interesting you refer to "having to hold a stock till the option expires". My personal view is that covered calls only have much value for buy and hold stock investors who are happy to hold through thick and thin but want to generate a bit of extra income on the way.
As a short to medium term position it's just a naked short put with higher capital requirement and higher commissions. If you wouldn't sell a naked put then don't do a covered call.
Gareth
As a short to medium term position it's just a naked short put with higher capital requirement and higher commissions. If you wouldn't sell a naked put then don't do a covered call.
Gareth
Yep, I hate to hold anything longer than 3hours, but a recent change in my life makes trading hours unavailable. I'm trying to figure something else out.
Thinking about maybe forex, I just wonder how much I'd have to learn to switch from stocks.
Swing trading maybe, but the suspense of knowing whether I'm right or wrong taking days to weeks really drives me nuts. Also the well known gaps in the wrong direction during the open really bother me.
That's why I was always in after the open and out before lunch.
Maybe someone has some advice to put me back on the right path.
Thanks everyone.
A Dashing Blade
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Unless the stock ramps up very agressively, this stratagy will outperform a simple "hold stock" strat.
Not all stocks have options that make it worth doing. Some stocks are good for covered calls. I like the down side protection. Also if I can make 1% a month doing collar trades I'll go for that. One way is not better than the other there are trade offs. Each person has to look at the risk /rewards and make up their own mind.la9 said:
