by LeAnne Perkowski | Oct 24, 2018 | Melinda's blog
From Melinda May, CPA | Featherstone Just as volatility and high prices might make some investors leery of stocks now (see “Buy-write strategies for a flat market”), the threat of rising interest rates may worry fixed income investors. Rising rates tend to depress...
by LeAnne Perkowski | Oct 22, 2018 | Melinda's blog
From Melinda May, CPA | Featherstone Just as volatility and high prices might make some investors leery of stocks now (see “Buy-write strategies for a flat market”), the threat of rising interest rates may worry fixed income investors. Rising rates tend to depress...
by LeAnne Perkowski | Oct 19, 2018 | Melinda's blog
From Melinda May, CPA | Featherstone Down Market Carl’s shares of XYZ might plummet because of company news or a broad stock retreat. The $180 in cash from selling the call would be scant consolation if his $10,000 outlay drops to $9,500 or $9,000 or lower. Carl could...
by LeAnne Perkowski | Oct 18, 2018 | Melinda's blog
From Melinda May, CPA | Featherstone Up Market In another scenario, XYZ shares break above the $55 exercise price, and the call options are exercised. As this is a “covered” call, Carl can fulfill his obligation under the option contract by delivering the 200 shares...
by LeAnne Perkowski | Oct 17, 2018 | Melinda's blog
From Melinda May, CPA | Featherstone Flat Market Say that XYZ shares bounce around $50 for three months. They never top $55, so it never pays for the owner of the option to buy Carl’s shares. The call option expires unexercised. Here, Carl’s $180 income from selling...
by LeAnne Perkowski | Oct 16, 2018 | Melinda's blog
From Melinda May, CPA | Featherstone Selling the Upside A covered call strategy can begin with the purchase of a stock that seems appealing. Example: In October, Carl Wagner buys 200 shares of XYZ Corp., trading at $50, for $10,000. He instructs his adviser to sell...
Recent Comments