Covered Call Picks (NOK,NAV,S,CRM,SLW)
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.
Nokia ADR representing one Ord Shs Series A (NOK) is currently trading at $3.25. Its 52 week range is between $1.63 and $7.38.
Navistar International Corp (NAV) is currently trading at $23.32. Its 52 week range is between $20.07 and $48.18.
Sprint Nextel Corp (S) is currently trading at $4.82. Its 52 week range is between $2.1 and $5.49.
Salesforce.com Inc (CRM) is currently trading at $149.06. Its 52 week range is $94.09 and $164.75.
Silver Wheaton Corp (SLW) is currently trading at $33.78. Its 52 week range is between $22.94 and $42.5.
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
- The Wildest Predictions For Oil Prices In 2016 | ZeroHedge
- Understanding Societal Collapse: Warnings From Venezuela's Crisis | ZeroHedge
- Panic-Buyers Lift WTI Crude Back Over $48 | ZeroHedge
- If You're Going To The Rio Olympics, Here's How To Make A 56% Return 'Legally' | ZeroHedge
- Stronger Dollar Sends Futures Higher, Oil Lower, Asian Stocks To Two Month Lows | ZeroHedge
- Ep. 168 – Tony Hawk: Don’t Stand Still | Altucher Confidential
- Hacker Who Got Inside Hillary Clinton's Server Said To Cooperate Fully With Ongoing Email Investigation | ZeroHedge
The most relevant financial news and articles from the Internets
- GOLDMAN SACHS: New Obama rule on overtime likely to add 100,000 jobs... | Business Insider
- Bernie Sanders just won an unusual concession from the Democratic Party amid... | Business Insider
- 7 things a neuroscientist knows but most people don’t | Business Insider
- Here's what we know about Xiaomi's... | Business Insider
- Tesla is opening a risky new store in the Hamptons (TSLA) | Business Insider
- These are the 10 best aviator sunglasses you can buy for under $150 | Business Insider
- This finance trend is so hot even Amazon wants in (AMZN) | Business Insider