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Leveraging covered call options in opportunistic scenarios may augment overall portfolio returns while mitigating risk. In brief, options are a form of derivative trading that traders can utilize in order to initiate a short or long position via the sale or purchase of contacts. An option is a contract which gives the buyer of the contract the right, but not the obligation, to buy or sell an underlying security at a specified price on or before a specified date. The seller has the obligation to buy or sell the underlying security if the buyer exercises the option. An option that gives the owner (buyer) the right to buy the security at a specific price is referred to as a call (bullish); an option that gives the right of the owner to sell the security at a specific price is referred to as a put (bearish). In the event of a covered call, this is accomplished by leveraging the shares one currently owns by selling a call contact against those shares for a premium. I will provide an overview of how a covered call is utilized and executed. Here, I’ll provide details focusing on optimizing stock leverage (covered calls). Emphasizing the ability to sell these types of options in a disciplined and conservative manner to generate liquidity while accentuating returns and mitigating risk. Continue reading "Disciplined and Conservative Covered Call Writing To Accentuate Returns And Mitigate Risk" →