Tackle Today: Tackle 25 2022 edition Part 4: How to trade Covered Calls on Expensive Stocks
December 30, 2021
« The Poor Boy’s Covered Calls List. »
Coach Mark here.
Tick tock…the clock continues to tick toward a new year and the release of the Tackle 25, Tackle Trading’s list of 25 great fundamental companies for 2022. As I have been mentioning all week, 2022 should be a really solid year for companies with tremendous fundamentals. The Tackle 25 will help you get a head start on this powerful 2022 trend. In addition to the Tackle 25 next week, we will be releasing our ten companies on our Poor Boy’s Covered Calls list.
The Poor Boy’s Covered Call is a list of the top ten higher-priced stocks that are great for covered calls but due to the cost of owning 100 shares can be better used in calendar spreads. A calendar spread is a simple options strategy where:
- Instead of buying 100 shares of a company you but a longer-term option
- You simultaneously sell a call option (like you would with a covered call on 100 shares)
Simultaneously entering a long and short position on the same underlying asset creates a calendar spread. Our Poor Boy’s Covered Call list is a list of 10 great companies that are fundamentally sound and a little higher priced where this strategy can be implemented. We will release this list next week when we unveil the Tackle 25. I am excited about next week!
Also, don’t forget next Monday on the Tackle Trading YouTube channel we will be holding our “Boomerang Trading” special webinar at 8:30 PM EST.
🛑 Upcoming Webinar › How to use the Boomerang Strategy to Trade Fundamentally Strong Stocks for Cash Flow | Jan 3rd at 8:30 PM EST
In this Tackle Trading webinar, Coach Matt will teach you how to use the Boomerang Strategy where you use Short Puts and Covered Calls to generate cash flow using strong fundamental stocks. Naked Puts and Covered Calls are core options strategies and are primarily used by traders to generate positive theta i.e. Cash Flow through their trading.
In this webinar, you will learn:
✅ What is a Naked Put
✅ What is a Covered Call
✅ Which types of stocks are used for the Boomerang technique?
✅ Basic Technical Trends and Patterns for Boomerang candidates
✅ Option Contract Basics
✅ Option Strike Prices
✅ Option Expiration Dates
✅ The Power of Compounding Returns
✅ Proper Mindset for Cash Flow Trading
Chart of the Day: S&P 500 Futures (/ES)
The S&P 500 continues to take a little breather after a strong four-day rally. As mentioned yesterday, these little breathers can be extremely healthy for those interested in participating in a more sustained trend. Stocks can’t go parabolic every day, right? If this breather continues to the end of the week, it creates an interesting setup at the start of the new year.
Video of the day: Special Webinar: The Poor Boy’s Covered Call Options Strategy
If you want to learn more about the Poor Boy’s Covered Call (PBCC), Coach Tyler Craig did a very informational webinar on this topic. This is a deep dive into the PBCC and is very informative for those who want to learn more about this strategy.
Today’s Line up
Traders Lounge 11 AM EST
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Cashflow Club 8:30 PM EST
Held every Thursday before Friday’s option contract expirations, this show helps you perfect your favorite cashflow strategies.
Halftime Report 12:30 PM EST
The Halftime Report starts at 12:30 EST and covers what news is driving the market, chart analysis from the movers and shakers of the day, and fun in a way that only Matt and Tim can deliver.
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