Covered Call Picks (OSG,BMRN,FB,NSM,SODA)
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.
|OSG||Overseas Shipholding Group Inc||3.54||4||0.3||8.50%||November 2012|
|BMRN||BioMarin Pharmaceutical Inc||42.8||43||3.6||8.40%||November 2012|
|FB||Facebook Inc||19||19||1.5||7.60%||November 2012|
|NSM||Nationstar Mortgage Holdings Inc||33.7||35||2.4||7.00%||November 2012|
|SODA||Sodastream International Ltd||39.1||40||2.2||5.60%||November 2012|
Overseas Shipholding Group Inc (OSG) is currently trading at $3.54. Its 52 week range is between $3.13 and $15.16.
BioMarin Pharmaceutical Inc (BMRN) is currently trading at $42.82. Its 52 week range is between $30.06 and $44.18.
Facebook Inc (FB) is currently trading at $18.98. Its 52 week range is between $17.55 and $45.
Nationstar Mortgage Holdings Inc (NSM) is currently trading at $33.7. Its 52 week range is between $13 and $37.2.
Sodastream International Ltd (SODA) is currently trading at $39.05. Its 52 week range is between $27.6 and $48.13.
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
- Dr. Keith Barron on Helicopter Drops, Gold, and Brexit | Financial Sense
- Oil Jumps Above $49 As Crude Production Tumbles, Inventories Drop | ZeroHedge
- Revenge Of The Rubes - Why The Days Of The Financial Elite's Rule Are Numbered | ZeroHedge
- The Algos Are Winning Again (In Trading The Brexit Chaos) | ZeroHedge
- Conference Board Leading Economic Index: Decrease in May | Financial Sense
- Don't Count Out Donald Trump Yet | ZeroHedge
- Bond Mechanics in a Negative Interest Rate World | Financial Sense
The most relevant financial news and articles from the Internets
- Gas prices are the lowest they've been since 2005 | Business Insider
- Head of CIA: ISIS is plotting attacks against US | Business Insider
- Here’s how the US Air Force and Army train to take any airfield in the world | Business Insider
- 3 things you can learn from the most effective leaders on 'Game of... | Business Insider
- 16 'Game of Thrones' items to buy for a superfan who is in withdrawal | Business Insider
- Photos show the aftermath of the Istanbul airport bombing | Business Insider
- Hillary Clinton on the Benghazi committee: It 'found nothing' | Business Insider