Covered Call Picks (UNXL,ACI,IOC,ARNA,CLF)
What's a Covered Call?
The covered call is a strategy where an investor writes a call option contract (sells an option) while at the same time owning an equivalent number of shares of the underlying stock.If this stock is purchased simultaneously with writing the call contract, the strategy is commonly referred to as a buy-write.
While you may have heard that trading options is risky business, covered calls are actually a very conservative strategy, and most brokerages even allow retirement IRA accounts to write covered calls.
|UNXL||UniPixel Inc||35.7||36||3.7||10.40%||May 2013|
|ACI||Arch Coal Inc||4.89||5||0.3||6.30%||May 2013|
|IOC||InterOil Corp||77||77.5||4.8||6.20%||May 2013|
|ARNA||Arena Pharmaceuticals Inc||7.95||8||0.5||6.20%||May 2013|
|CLF||Cliffs Natural Resources Inc||17.7||18||1||5.80%||May 2013|
UniPixel Inc (UNXL) is currently trading at $35.67. Its 52 week range is between $5.15 and $41.42.
Arch Coal Inc (ACI) is currently trading at $4.89. Its 52 week range is between $4.47 and $10.26.
InterOil Corp (IOC) is currently trading at $76.99. Its 52 week range is between $47.33 and $99.05.
Arena Pharmaceuticals Inc (ARNA) is currently trading at $7.97. Its 52 week range is between $2 and $13.5.
Cliffs Natural Resources Inc (CLF) is currently trading at $17.65. Its 52 week range is between $16.96 and $69.5.
MASTERY Bottom line:
There are pros and cons to writing covered calls. In theory, this strategy will out perform outright stock ownership if the stock price declines, remains the same, or slightly increases in price. The principal disadvantage of this strategy, on the other hand, is that profit potential can be limited if the underlying stock price advances sharply.
Best of the Blogs
Scanning and identifying the best blog entries every hour
- Caterpillar Retail Sales Decline For 46 Consecutive Months; Worst Month For North America Since 2010 | ZeroHedge
- Is It Time For Another World War? (In 2 Charts) | ZeroHedge
- Dollar Breakout Sends Chinese Yuan To Lowest On Record In Offshore Trading | ZeroHedge
- Manic Merger Monday Saves Stocks As China Currency Crashes To Record Low | ZeroHedge
- Polls 1 - 0 Crowds: Despite Apparent 'Lead', Democrats Face Empty Rallies In Florida | ZeroHedge
- Podesta Files Part 17: Wikileaks Releases Another 3,400 Emails, Bringing Total To Over 30,000 | ZeroHedge
- While Presidential Election Takes Focus, US Economy Slips Further | Financial Sense
The most relevant financial news and articles from the Internets
- The Pentagon is demanding soldiers pay back huge cash bonuses that were given out... | Business Insider
- 3 US senators want the women's US golf open moved away from Trump's New... | Business Insider
- 2012 Honda CR-V | BusinessWeek
- 6 rules for loaning money to a family member | Business Insider
- The negative tone of the presidential election is turning off... | Business Insider
- The woman at the center of the Rolling Stone rape scandal says PTSD has affected her... | Business Insider
- Chinese billionaires, gangsters, and spies have been... | Business Insider