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
- USDJPY Plunges To 113 Handle - Gives Up QQE2 Gains | ZeroHedge
- Why Trump Thinks Unemployment Is 42% | ZeroHedge
- Putin Uses the Refugee Crisis to Weaken Merkel | ZeroHedge
- Profit At World's Largest Shipping Company Plunges On Collapsing Global Trade, Sinking Crude Prices | ZeroHedge
- The Walking Dead: Something Is Rotten In The Banking System | ZeroHedge
- Clueless Fed?! | Financial Sense
- Deutsche Bank Is Back: 5 Year Sub CDS Soar To Record High | ZeroHedge
The most relevant financial news and articles from the Internets
- The only way to get out of Amazon's terms of service is a zombie apocalypse (AMZN) | Business Insider
- A human rights group wants your old USB drives to help overthrow Kim Jong Un | Business Insider
- Beyoncé's backup dancers stole the Super Bowl halftime show with a... | Business Insider
- Cam Newton responded to criticism of his contentious Super... | Business Insider
- These are the 10 'love songs' people listen to the most on Spotify | Business Insider
- The insane Sherp ATV is a Russian-made machine with 4 huge tires that can also swim | Business Insider
- The terrible consequences of hitting the snooze button in the morning | Business Insider