Saturday, April 10, 2010

Covered Calls: A primer for layman investors and option traders

Covered call is a call option strategy for an investor who owns option-able stocks.In this strategy, an investor tries to increase his/her income on the stocks that he/she already owns by selling call options. It is considered the most conservative strategy in options trading. It is mostly suitable for investors who has neutral outlook for the stock.

In next part, I will discuss how to set up a covered call.