Ad
related to: covered call example and graph pattern in stock market for beginners video
Search results
Results from the WOW.Com Content Network
A covered call involves selling a call option on a stock that you already own. By owning the stock, you’re “covered” (i.e. protected) if the stock rises and the call option expires in the money.
Payoffs from a short put position, equivalent to that of a covered call Payoffs from a short call position, equivalent to that of a covered put. A covered option is a financial transaction in which the holder of securities sells (or "writes") a type of financial options contract known as a "call" or a "put" against stock that they own or are shorting.
Writing out-of-the-money covered calls is a good example of such a strategy. The purchaser of the covered call is paying a premium for the option to purchase, at the strike price (rather than the market price), the assets you already own. This is how traders hedge a stock that they own when it has gone against them for a period of time.
You can sell a call on the stock with a $20 strike price for $2 with an expiration in eight months. One contract gives you $200 ($2 * 1 contract * 100 shares). ... For example, if the stock ...
A covered call position is a neutral-to-bullish investment strategy and consists of purchasing a stock and selling a call option against the stock. Two useful return calculations for covered calls are the %If Unchanged Return and the %If Assigned Return. The %If Unchanged Return calculation determines the potential return assuming a covered ...
For premium support please call: 800-290-4726 more ways to reach us. Sign in. Mail. 24/7 Help. ... Wall Street experts highlighted the most important stock market charts to watch into next year.
If the price of the underlying stock is above a call option strike price, the option has a positive intrinsic value, and is referred to as being in-the-money. If the underlying stock is priced cheaper than the call option's strike price, its intrinsic value is zero and the call option is referred to as being out-of-the-money. An out-of-the ...
For premium support please call: 800-290-4726 more ways to reach us
Ad
related to: covered call example and graph pattern in stock market for beginners video