Covered Call Picks (GRPN,VRNG,AMRN,NAV,FSLR)
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.
|AMRN||Amarin Corporation PLC||11.3||12||1.6||14.10%||Sep-12|
|NAV||Navistar International Corp||25.2||26||2.7||10.50%||Sep-12|
|FSLR||First Solar Inc||21.4||22||1.7||7.80%||Sep-12|
Groupon Inc (GRPN) is currently trading at $6.93. Its 52 week range is between $6.35 and $31.14.
Vringo Inc (VRNG) is currently trading at $3.44. Its 52 week range is between $0.68 and $5.45.
Amarin Corporation PLC (AMRN) is currently trading at $11.34. Its 52 week range is between $5.99 and $15.96.
Navistar International Corp (NAV) is currently trading at $25.17. Its 52 week range is $20.07 and $48.18.
First Solar Inc (FSLR) is currently trading at $21.41. Its 52 week range is between $11.43 and $107.99.
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
- More Lukewarm Econ Data to Match Q1 Earnings | Financial Sense
- ReaDY FoR SoDoMY... | ZeroHedge
- Why The Founder Of A $35 Billion Hedge Fund Is "Very Worried" | ZeroHedge
- "Rich" Americans Confidence Crashes Most Since 2013 | ZeroHedge
- Warning: Hawkishness Ahead | Financial Sense
- "I Can Only Say I'm Sorry" - Self-Professed Bitcoin "Creator" Can't Provide Proof, Backs Out | ZeroHedge
- Stunning Dash Cam Footage From Inside Alberta's "Apocalyptic" Inferno | ZeroHedge
The most relevant financial news and articles from the Internets
- CITI: The Fed would attempt one last 'Hail Mary' before... | Business Insider
- The earliest Zika vaccine won’t be ready until 2018 — which might already be too late | Business Insider
- How to find out everything Google knows about you | Business Insider
- Video shows the incredible scale of the US military’s... | Business Insider
- These are the incredible boats racing in the America's Cup this weekend in New York | Business Insider
- The 12 wealthiest public colleges in America | Business Insider
- EL-ERIAN: Here are 5 reasons why the Fed probably won't do... | Business Insider