Covered Call Picks (YOKU,GMCR,BAC,CLF,UPL)
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.
|GMCR||Green Mountain Coffee Roasters Inc||51.4||52.5||2.7||5.30%||Apr-12|
|BAC||Bank of America Corp||9.8||10||0.4||4.20%||Apr-12|
|CLF||Cliffs Natural Resources Inc||72||72.5||2.9||4.00%||Apr-12|
|UPL||Ultra Petroleum Corp||24.9||25||1||4.00%||Apr-12|
Youku Inc (YOKU) is currently trading at $27.06. Its 52 week range is between $13.76 and $69.95.
Green Mountain Coffee Roasters Inc (GMCR) is currently trading at $51.39. Its 52 week range is between $34.06 and $115.98.
Bank of America Corp (BAC) is currently trading at $9.8. Its 52 week range is between $4.92 and $14.29.
Cliffs Natural Resources Inc (CLF) is currently trading at $72.03. Its 52 week range is $47.31 and $102.48.
Ultra Petroleum Corp (UPL) is currently trading at $24.9. Its 52 week range is between $22.51 and $51.2.
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
- Pope Francis Gets Involved In Geopolitics, "Endorses Use Of Force" Against ISIS Jihadists | ZeroHedge
- MeMoRieS OF MaRTHa'S ViNeYaRD... | ZeroHedge
- Argentina’s Default Raises More Questions Than Answers | Financial Sense
- Ferguson Curfew Cancelled As National Guard Arrives; Holder Demands To "Remove The Damn Tanks" | ZeroHedge
- How Much Does It Cost America To Blow Up American Weapons? | ZeroHedge
- What Are the Smart Guys Saying? | Financial Sense
- China Becoming Global Gold Hub And Gold Price Discovery Centre | ZeroHedge
The most relevant financial news and articles from the Internets
- 2014 Is Expected To Be The Solar Market's Tightest Supply Year In Nearly Half A... | Business Insider
- Jim Chanos Blows Up The 2 Most Commonly Cited Arguments Against Short-Selling... | Business Insider
- People Keep Getting Into Random Cars Thinking They're Ubers | Business Insider
- Investor Allegedly Emails Female Startup Employee: 'I'm... | Business Insider
- Here's Why North Carolina Keeps Getting Poorer | Business Insider
- Shopping Cart... | Business Insider
- 10 Of The Most Ridiculous TED Talks | Business Insider