Thanks Cameron, this is very interesting. I think I have been doing something like this by continuously selling calls covered by stock. I assume you are telling us that buying a long call, at the money, while continously selling shorter dated calls, should increase profitability over just owning the stock and selling calls, assuming the stock is higher in one year more or less.
Sounds like you have a good handle on the strategy, although I should also clarify that the long call can lose its entire value much more easily than true share ownership might. In any case, thanks for watching! ^CM
Thank You Cameron, I would need 56,000 dollars of available for trading bucks ,,just in case the outside possibility of this short contract gets assigned? Am I thinking correctly ? Sorry but I want to know what bad stuff could happen.
Happy to clarify! In the case of assignment of the short call, the trader would actually receive $56,000 in exchange for 100 shares purchased from them, and these funds could be applied toward the purchase of shares to cover the short stock position. However, the trader would be responsible for any difference between $560 and the cost to buy the shares. I hope this helps, and thanks for watching! ^CM
Thank You Cameron!
Thanks again for watching! ^CM
Awesome, can you please share the playlist this series will be added to?
Here's the playlist for my "Long Verticals and Diagonals" TH-cam series: th-cam.com/play/PL8a6s5nq1lPQoKbvXR3kkaAHB57JxRMs7.html. Enjoy! ^CM
Thanks Cameron, this is very interesting. I think I have been doing something like this by continuously selling calls covered by stock. I assume you are telling us that buying a long call, at the money, while continously selling shorter dated calls, should increase profitability over just owning the stock and selling calls, assuming the stock is higher in one year more or less.
Sounds like you have a good handle on the strategy, although I should also clarify that the long call can lose its entire value much more easily than true share ownership might. In any case, thanks for watching! ^CM
Thank You Cameron, I would need
56,000 dollars of available for trading bucks ,,just in case the outside possibility of this short contract gets assigned? Am I thinking correctly ? Sorry but I want to know what bad stuff could happen.
Happy to clarify! In the case of assignment of the short call, the trader would actually receive $56,000 in exchange for 100 shares purchased from them, and these funds could be applied toward the purchase of shares to cover the short stock position. However, the trader would be responsible for any difference between $560 and the cost to buy the shares. I hope this helps, and thanks for watching! ^CM