The covered call is a conservative options strategy. In executing the trade – you buy the stock and write/sell the call option. This strategy is typically used when we have a short-term neutral view on the stock. We will hold the stock long and simultaneously sell the option to generate income. We are have a proprietary covered call filter that selects covered call opportunities that have a high probability to generate income and profits.
In the case of the example below with GE – you would buy the stock and sell the option for $1.55 (collecting the option premium)
|Stock Symbol||Company Name||Buy the Stock||Sell the Option|
|GE||General Electric||Buy the stock for $27.06||Sell the $30.00 call expiring on Friday, April 21, 2017 for $1.55|
|WFM||Whole Foods Market||Buy the stock for $25.80||Sell the $27.00 call expiring on Friday, March 31, 2017 for $0.51|