Covered Call Picks (OCZ,STP,MLNX,JAG,SQNM)
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.
OCZ Technology Group Inc (OCZ) is currently trading at $1.99. Its 52 week range is between $1.11 and $10.05.
Suntech Power Holdings Co Ltd (STP) is currently trading at $1.74. Its 52 week range is between $0.71 and $4.4.
Mellanox Technologies Ltd (MLNX) is currently trading at $51.69. Its 52 week range is between $30.55 and $120.05.
Jaguar Mining Inc (JAG) is currently trading at $0.93. Its 52 week range is between $0.58 and $7.35.
Sequenom Inc (SQNM) is currently trading at $4.15. Its 52 week range is between $2.65 and $5.83.
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
- Texas Tea & Treasury Yields Tumble As Trannies Top The Day | ZeroHedge
- Global Gold Demand Will Overwhelm the Manipulators | ZeroHedge
- I Bought The $HABT | iBankCoin.com
- Markets Rally on Surprise Easing by China | Financial Sense
- The Unbearable Over-Determination Of Oil | ZeroHedge
- Insight on Automation | ZeroHedge
- "Now That's What I Call A Bubble" | ZeroHedge
The most relevant financial news and articles from the Internets
- South Korea Just Banned Unregulated Selfie Sticks | Business Insider
- Ebola vaccine promising in first human trials: NIH | Business Insider
- Does OPEC's Meeting Still Matter for Energy Stock Investors? | TheStreet.com
- Apple Is Being Pressured To 'Set A... | Business Insider
- Kobe Bryant's Daughter Understands The Secret To Being Clutch | Business Insider
- Here's What Happens When Thousands Of Screaming Tweens Meet Their YouTube... | Business Insider
- Amazon's Hit Man | BusinessWeek