Covered Call Picks (CLSN,MBI,GMCR,MCP,AGO)
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.
Celsion Corp (CLSN) is currently trading at $7.58. Its 52 week range is between $1.63 and $7.86.
MBIA Inc (MBI) is currently trading at $8.56. Its 52 week range is between $6.78 and $13.5.
Green Mountain Coffee Roasters Inc (GMCR) is currently trading at $28.95. Its 52 week range is between $17.11 and $71.15.
Molycorp Inc (MCP) is currently trading at $8.47. Its 52 week range is between $5.75 and $35.79.
Assured Guaranty Ltd (AGO) is currently trading at $13.9. Its 52 week range is between $9.22 and $19.04.
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
- Dudley Terrified By "Over-Reaction" To QE End, Says Fed Could Do "More Or Less" QE | ZeroHedge
- Two Charts I am Eyeballing Here | iBankCoin.com
- Capital Going TO Russia with Love | iBankCoin.com
- This is Not Your Ordinary Internets | iBankCoin.com
- Guess Who The Dirtiest Dirty Shirt Is | ZeroHedge
- Thanks To QE Bernanke Has Injected Foreign Banks With Over $1 Trillion In Cash For First Time Ever | ZeroHedge
- Why Did Gold Recover More than $53 an Ounce in Yesterday’s Markets? | ZeroHedge
The most relevant financial news and articles from the Internets
- The Most Polite And Potty-Mouthed States In The US [MAP] | Business Insider
- There Was A Mass Exodus From Tumblr Right As They Sealed The Deal With Yahoo | Business Insider
- Attorney Who OK'd AP Phone Taps Also Represented Firm That Allegedly Hacked... | Business Insider
- Markets Are Higher After Another Historic Night In Japan | Business Insider
- BI INTELLIGENCE FORECAST: Google Glass Will Be An $11 Billion Market By 2018 | Business Insider
- WHAT SCANDALS? Obama's Approval Rating Is... | Business Insider
- RG3 Criticized For Posting A Picture Of Wedding Gifts Purchased By Fans | Business Insider