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Exit Strategy Considerations When a Strike Moves Deep ITM Early in a Contract – May 2, 2022
When our covered call writing and put-selling trades start out much better than anticipated, Blue Collar Investors immediately evaluate our exit strategy arsenal to see if we can achieve even higher...
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Analyzing the Cost-To-Close a Covered Call Trade Mid-Contract: A Real-Life Example with NVDIA Corp. (Nasdaq: NVDA) – April 25, 2022
Breaking down the components of a deep ITM strike As the strike moves deeper in-the-money as share price rises, the time-value component of that option premium approaches zero. However, the intrinsic-value component...
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Rolling-Out to Impressive Profits: A Real-Life Example with NVIDIA Corp. (Nasdaq: NVDA) – April 18, 2022
Exit strategies for covered call writing will elevate returns and mitigate losses. When share price accelerates dramatically, we can take advantage of these opportunities by rolling our options out...
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Analyzing a Multi-Faceted Series of Covered Call Trades: A Real-Life Example with Kohl’s Corp. (NYSE: KSS) – April 11, 2022
When we write a covered call option, we first buy a stock or exchange-traded fund (ETF) and then sell the call option which is protected by first owning the underlying security....
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Large Returns Can Be Enticing: We Must Do the Math to Make Sensible Trades – April 4, 2022
Our covered call writing and put-selling trades initially generate cash into our brokerage accounts. The amount of cash can be impressive on the surface but we must break down...
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Covered Call Writing Strike Selection in Bull, Bear and Neutral Markets: A Real-Life Example with Crocs, Inc. (Nasdaq: CROX) – March 28, 2022
Covered call writing strike selection will vary from investor-to-investor. There is no single parameter that will guide us to the most appropriate strikes for our portfolios. Factors that must...
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A 6-Income Stream Monthly Cash-Secured Put: A Real-Life Example with InMode Ltd. (Nasdaq: INMD) – March 21, 2022
Is it true that when we sell cash-secured puts, our maximum return is the initial put premium? Come on now, we’ve all heard and read that statement. This article...
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What is a Delta-Neutral Portfolio?: A Real-Life Example With InMode Ltd. (Nasdaq: INMD) – March 14, 2022
Many portfolio managers will seek Delta-neutral portfolios to mitigate directional or market risk. This article will explain how these experts calculate their positions to achieve this goal. To simplify the details,...
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Collar Trades: The Rationale for Maximum Gains and Losses – March 7, 2022
Covered call writing trades have 2 legs: the long stock position and the short call. The collar trade adds a third leg, the long protective put. The calculations for potential trade maximum gain...
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Generating a 3-Income Stream Put Trade: A Real-Life Example with ZIM Integrated Shipping Services Ltd. (NYSE: ZIM) – February 28, 2022
We have all read that when we sell a cash-secured put, the maximum return is the put premium. Is that true 100% of the time? Enter our exit strategy arsenal....
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