http://lamdar.com/2010/01/09/covered-calls/ - Stock Market Analysis Wed, 30 Nov 2011 12:34:41 +0000 hourly 1 http://wordpress.org/?v=3.3.1 http://lamdar.com/2010/01/09/covered-calls/comment-page-1/#comment-361 lamdar Sun, 10 Jan 2010 06:52:44 +0000 http://lamdar.com/2010/01/09/covered-calls/#comment-361 A vertical spread (at least a bull call spread) is essentialy the same thing as a covered call, except you're using a call option instead of the underlying stock. That makes it so that you're also paying a time premium, so you're betting much more on the movement of the stock and not just trying to profit off of selling the option. This means a bull call spread is a bet on upwards movement, whereas the covered call is more of a bet on a flat stock (but will still make some money if the stock moves up). A vertical spread (at least a bull call spread) is essentialy the same thing as a covered call, except you’re using a call option instead of the underlying stock. That makes it so that you’re also paying a time premium, so you’re betting much more on the movement of the stock and not just trying to profit off of selling the option. This means a bull call spread is a bet on upwards movement, whereas the covered call is more of a bet on a flat stock (but will still make some money if the stock moves up).

]]> http://lamdar.com/2010/01/09/covered-calls/comment-page-1/#comment-360 GoldLover Sun, 10 Jan 2010 06:37:21 +0000 http://lamdar.com/2010/01/09/covered-calls/#comment-360 How are covered calls better than vertical spreads? It seems like the spreads require a lot less capital, so you could aim for smaller gains across more positions and make consistent money too. How are covered calls better than vertical spreads? It seems like the spreads require a lot less capital, so you could aim for smaller gains across more positions and make consistent money too.

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