Selling covered calls is a common options trading tactic used by stockholders looking to increase their profits. In this approach, call options are sold on shares of a specific stock (referred to as the underlying asset) that an investor owns in a predetermined quantity. The investor gives the buyer the right, up until the option's expiration date, to buy the underlying shares at a predetermined price (the striking price) when they sell a call option. The buyer gives the seller a premium in exchange for this right. The seller keeps the premium as profit if the stock price stays below the strike price until it expires, at which point the call option expires worthless.
Saturday, March 23, 2024
How To Sell Covered Calls on AMZN : Beginner's Tutorial
Selling call options can be an easy way to collect money from your stock holding. Learn how to sell covered calls in this video:
Selling covered calls is a common options trading tactic used by stockholders looking to increase their profits. In this approach, call options are sold on shares of a specific stock (referred to as the underlying asset) that an investor owns in a predetermined quantity. The investor gives the buyer the right, up until the option's expiration date, to buy the underlying shares at a predetermined price (the striking price) when they sell a call option. The buyer gives the seller a premium in exchange for this right. The seller keeps the premium as profit if the stock price stays below the strike price until it expires, at which point the call option expires worthless.
Selling covered calls is a common options trading tactic used by stockholders looking to increase their profits. In this approach, call options are sold on shares of a specific stock (referred to as the underlying asset) that an investor owns in a predetermined quantity. The investor gives the buyer the right, up until the option's expiration date, to buy the underlying shares at a predetermined price (the striking price) when they sell a call option. The buyer gives the seller a premium in exchange for this right. The seller keeps the premium as profit if the stock price stays below the strike price until it expires, at which point the call option expires worthless.
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