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Covered Call Option Success Tips
How to increase your yield on stock options, and covered call
options.
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Pharmaceutical companies are very volatile and are not
good covered call candidates.
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Use moving averages (5,20 day) to spot uptrending stocks
for a covered call.
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Instead of selling stocks outright, consider writing
a covered call. That way you name your sales price as
well as pick up an option premium on the covered call
sale.
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You should write a near-month covered call. This results
in higher daily yields than if you write a covered call
with expirations two or more months out.
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Use a limit order to sell a covered call. This allows
you to set the price, a market order does not. You can
specify a GTC limit order and just wait for the order
to be filled.
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Option premium quotes can become stale because the covered
call option has not been traded for some time. Each covered
call in our report has been traded that day.
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Writing a covered call on stocks priced at less than
$40 per share creates a higher percentage covered call
option premium yield than writing a covered call on higher-priced
stocks.
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Your profits grow faster if you write your covered call
in an account, such as an IRA.
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