Covered Call Picks (VHC,OCZ,VQ,NAV,WLT)
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.
VirnetX Holding Corp (VHC) is currently trading at $23.66. Its 52 week range is between $11.01 and $41.93.
OCZ Technology Group Inc (OCZ) is currently trading at $6.27. Its 52 week range is between $4.14 and $10.05.
Venoco Inc (VQ) is currently trading at $9.27. Its 52 week range is between $6.5 and $13.
Navistar International Corp (NAV) is currently trading at $24.6. Its 52 week range is $20.21 and $52.36.
Walter Energy Inc (WLT) is currently trading at $34.3. Its 52 week range is between $31.33 and $126.
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
- It Begins: Council On Foreign Relations Proposes That "Central Banks Should Hand Consumers Cash Directly" | ZeroHedge
- China Has Lost 55% Of Its Most Valuable Resource | ZeroHedge
- Caption Contest: "He Doesn't Bite" Edition | ZeroHedge
- Five Stocks Which Are Rare Catches Today | iBankCoin.com
- Consumer Confidence Rises Again | Financial Sense
- The Status Quo's Model Of "How The World Works" Is Broken | ZeroHedge
- 2nd American ISIS Fighter Killed In Syria, CNN Reports | ZeroHedge
The most relevant financial news and articles from the Internets
- Chipotle Says It Will Completely Replace Fast Food Chains | Business Insider
- The US Is Preparing Military Options Against The... | Business Insider
- Intel Will Unveil A New Luxury Smart Bracelet With A Curved Glass Display (INTC) | Business Insider
- A Blunt Giancarlo Stanton Quote Is The Latest Sign He's Going To Leave Miami | Business Insider
- Apple's Recent Hiring Spree Offers A Big Hint That New Products Are On The Way... | Business Insider
- Ocean City, Md.: America's Most Affordable Fun City | BusinessWeek
- Orbitz Is Tanking After American Airlines Pulls Fares From Site (OWW,... | Business Insider