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Establishing 84% Probability of Success Put Trades in Bear Markets – March 20, 2023
Selling deep out-of-the-money cash-secured puts in bear markets will provide us with additional protection to the downside in return for lower, but still significant, option returns. This article will...
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How to Calculate Dividends into Our Covered Call Writing Calculations – March 13, 2023
Covered call writing is a low-risk, cash generating option-selling strategy. Premium is generated by undertaking the contractual obligation to sell our shares at a price (strike price) and date...
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Estimating Our Breakeven Price Points When Establishing Our Poor Man’s Covered Call Trades: A Real-Life Example with Apple, Inc. (Nasdaq: AAPL) – March 06, 2023
When initiating our Poor Man’s Covered Call (PMCC) trades, we can estimate our breakeven (BE) price points. It gets more complicated as more layers are added to the trades over the months and,...
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Analyzing a 3-Income Covered Call Writing Trade: A Real-Life Example with Ready Capital Corp. (NYSE: RC) – February 27, 2023
Covered call writing with out-of-the-money (OTM) strikes provides the opportunity for 2 incomes streams, 1 from option premium and the other from share appreciation from current market value up to...
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Review of Dividend Dates & Their Impact on Our Covered Call Trades – February 21, 2023
The main reason for early exercise of our covered call writing options relates to corporate dividends. The key date to be aware of is the ex-dividend date. This article will clarify and...
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How to Enter and Archive Cash-Secured Put Trades Around an Earnings Report – February 13, 2023
In last week’s segment, I posted a series of cash-secured put trades with Etsy, Inc. (Nasdaq: ETSY). Some trades were executed before an earnings report and a few post-earnings....
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How to Manage Cash-Secured Put Trades Around an Earnings Report: A Real-Life Example with Etsy, Inc. (Nasdaq: ETSY) – February 06, 2023
When selling covered calls or cash-secured put options, we must avoid the risk of earnings reports. This is an important rule of the BCI methodology. This article will detail how a series of put...
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Calculating Realized Option & Unrealized Stock Covered Call Returns at the End of a Contract Cycle – January 30, 2023
Accurately calculating our covered call writing returns at the end of each contract cycle can be uncomplicated in some situations and more challenging in others. If we buy a...
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Rolling-Out Poor Man’s Covered Call Trades: A Real-Life Example with Alphabet Inc. (Nasdaq: GOOG) – January 23, 2023
When the Poor Man’s Covered Call (PMCC) strategy is employed, the short call is the active leg of the trade. If a strike is expiring in-the-money (ITM), we can roll...
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How to Use the Capital Adjustment Section of the Trade Management Calculator When Executing Multiple Exit Strategies in the Same Contract Cycle – January 16, 2023
Exit strategies for covered call writing and selling cash-secured parts are integral aspects of our trading system. It is critical to learn how to enter, calculate and archive these position...
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