Covered Call Picks (ATPG,VXX,FSLR,NFLX,UNG)
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.
|ATPG||ATP Oil & Gas Corporation||7.87||8||0.8||10.70%||Apr-12|
|VXX||iPath S&P 500 VIX Short-Term Futures ETN||26||27||2.4||9.40%||Apr-12|
|FSLR||First Solar Inc||27.6||28||2.6||9.30%||Apr-12|
|UNG||United States Natural Gas||18.7||19||1.1||6.00%||Apr-12|
ATP Oil & Gas Corporation (ATPG) is currently trading at $7.87. Its 52 week range is between $5.53 and $20.19.
iPath S&P 500 VIX Short-Term Futures ETN (VXX) is currently trading at $26.03. Its 52 week range is between $19.88 and $59.18.
First Solar Inc (FSLR) is currently trading at $27.63. Its 52 week range is between $27.5 and $163.
Netflix Inc (NFLX) is currently trading at $107.13. Its 52 week range is $62.37 and $304.79.
United States Natural Gas (UNG) is currently trading at $18.66. Its 52 week range is between $18.68 and $50.56.
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
- GReeCe 2015... | ZeroHedge
- What to Look for in the Week Ahead | ZeroHedge
- Housing Affordability: How Does the U.S. Compare to Canada, China, Australia, Japan, Ireland, UK | Financial Sense
- Greek Exit Polls Suggest Blowout Victory For Syriza: Live Webcasts From Greece | ZeroHedge
- Mapping The World's Greatest Risks (According To Davos) | ZeroHedge
- Spot The Difference: ISIS Or Saudi Arabia | ZeroHedge
- ECB Sets Up Biggest Contrarian Play of 2015 | Financial Sense
The most relevant financial news and articles from the Internets
- Sundance TV Festival? Lines blurring, says Redford | Business Insider
- Rebel leader announces launch of assault on Ukraine... | Business Insider
- Some People At Davos Are Wondering Why The Retail Currency Trading Business Is Even... | Business Insider
- Animated film brings van Gogh's art to life | Business Insider
- Here Are Some Of The Many Chinese Elites Who Use Offshore Tax Havens | Business Insider
- The Two Things That Really Move Markets (DB, EUR, USD) | Business Insider
- Apple's Supply-Chain Secret? Hoard Lasers | BusinessWeek