Last update: August 2021
≈ Do you use this technique? ≈
One of the most popular techniques in the equity and options market is the Covered Call. A Covered Call involves the purchase of at least 100 shares of stock and then the sale of 1 call option against that stock. Within our Trading Playbook, you can find rules on how to execute the Covered Call, and you can also take the Tackle 25 course to learn all the strategies around selecting, entering, and managing Covered Calls.
In a market like this, where volatility is high, the premiums are going to be attractive to cash flow traders. Have you been trading Covered Calls? If so, you have probably also ran into some of the complexity of high volatility markets. When markets rip higher, your calls go in the money and it requires management and an understanding of what to do and how to read your position. Do you roll up? Do you stand pat and let the market take your stock? These are important questions to answer.
When markets rip lower, your calls lose their premium and can give you an opportunity to manage them by rolling down, out or even buying put options.
Some of the complexity can be reduced at entry as well. If a trader sells a lower delta when entering the Covered Call, it gives more cushion between the current stock price and the strike price you sell. This can reduce the volatility in the call option’s change in price and make the degree of difficulty go down some.
Tonight, on our YouTube channel, Coach Noah will teach some of his favorite was to trade Covered Calls in a market like this, and following that show, Coach Greg will be hosting our Tackle 25 mastermind group for the month.
It’s a night of Covered Call training, and if you use this strategy you should make sure you attend and have you pen and notepad ready to learn some new techniques.
Chart of the Day: D.R. Horton, Inc. ($DHI)
D.R. Horton, Inc. (Ticker: $DHI) is one of our Tackle 25 stocks, which is a list of fundamentally strong companies which also optimized for Covered Call trading. It’s pushing resistance today, in an overall uptrend. Learn to trade covered calls with the Tackle 25 system, you can access the list of stocks with your PRO Membership here.
Video of the day: How to roll a Covered Call
Watch this discussion from Coach Matt, Mark, and Noah on how, when, and why to roll a Covered Call.
Tackle Trading Resources on Covered Calls
Continue learning about this powerful options trading strategy: the Covered Call. Tackle Trading has all the resources you need to MASTER this strategy like a PRO.
Covered Call For Beginners [Free Articles]
In this video tutorial, Coach T walks the team through how to set a basic stop on a covered call or naked put position.
In this video tutorial, Coach T from Tackle Trading walks through a research session for covered calls.
In this video tutorial, Coach Matt goes through the latest edition of the Options Research Spreadsheet explaining how to use it to find the best stocks to cash flow.
In this video, Tackle Trading’s Coach Tim explains when, how, and why a trader would buy a put option on a covered call position.
The Tackle 25 2016 Edition is up and better than ever. This list contains the best stocks to cash flow and compound your gains.
I seem to have struck a nerve with my call for a reverse split in USO. And that’s a good thing.
Watch and learn as Coach D demonstrates how to roll a covered call down and out to offset risk and bring in more premium as he repairs a protective call write that has traded below the strike price and break-even price point.
Just when I think I’ve exhausted my inventory of covered call insights I stumble upon yet another blog worthy concept. Today I’ll shine a light on how to identify the remaining profit in your trade, an essential skill for covered call management.
With the advent of weeklys options the choices facing option traders has multiplied ten-fold. But it shouldn’t be overwhelming.
Listen up you covered call lovers. Today I’m tackling some common questions on how to get the most out of your beloved buy-writes.
In this video tutorial, Coach Tim Justice teaches how to find the best candidates to trade the Covered Call options strategy using the Theta Research tool.
How to leverage an IRA account by selling covered calls on long-term call options (aka LEAPS) instead of stock? Read on.
The Tackle 25 2017 Edition is up and better than ever. This list contains the best stocks to cash flow and compound your gains.
I think I could write about covered calls and naked puts every single week and still have plenty to say at the end of the year.
I received an email the other day from a trader that bought a few stocks and has been selling covered calls against them. He had questions. I have answers. Here we go.
Nothing like a monster “V” shaped reversal to get the juices flowing, am I right? Count me among those suffering whiplash over the market’s death-defying whoops and whirls of late. Yesterday was particularly annoying for those short delta toting traders like me.
Last update: August 2021 ≈ Cash Flow and Growth ≈ I put a poll question in the clubhouse recently asking the Tackle Trading community a simple question: Do you trade Covered Calls? If you haven’t answered the question yet, you still can HERE. Of the 5 potential answers, the breakdown was interesting. 38% said YES
Traders have all sorts of rules and guidelines for managing covered calls that move in-the-money.
Let’s talk about proper strike price selection for covered calls and protective puts.
Portfolio Protection For Beginners [Free Articles]
Everyone invests. Everyone has money. Currency is a form of investment since the gold standard was removed from the currency system.
You’re a goose chaser. Admit it. It’s the gold you seek. And that’s okay. You’re in good company. Most of us round these parts have been searching for the big bird for ages. Some have even tagged one.
Come lear a Trick for Financing Portfolio Protection.
What is hedging? Come learn the basics in this 3-part series.
In part one of our new series on hedging, we defined precisely what the concept means. Today we’re turning to the why.
With a sound foundation on the what and why of hedging, we’re now ready to dissect the devil. Namely, when do I place my hedge?
The way that you go about hedging varies depending on what your strategy is. Come learn how to hedge a naughty naked put.
Today I want to talk a bit about the impact VIX spikes have on the cost of portfolio protection.
It’s nailing the management of Protective Puts that separates the men from the boys. Allow me to offer up a few ideas.
The bears are roaming. And while their sudden emergence likely spelled losses for traders far and wide, the pain doesn’t have to persist. I look at this as a “fool me once, shame on you; fool me twice, shame on me” situation.
Contrarians in a bear market seek signs of capitulation. Specifically, evidence that bulls are throwing in the towel and abandoning their once beloved positions.
Herein we explore the perks of lengthening your time horizon and embracing Long-term Investing.
Good traders keep excellent records. Quality trading journals are essential to your progress and growth as a trader and keeping good records will help you learn more from both your income and expense trades.
Learn more about HOW the Tackle Trading Journals can help you become a professional trader.
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