Covered Call Picks (ATPG,VXX,FSLR,NFLX,UNG)
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.
|ATPG||ATP Oil & Gas Corporation||7.87||8||0.8||10.70%||Apr-12|
|VXX||iPath S&P 500 VIX Short-Term Futures ETN||26||27||2.4||9.40%||Apr-12|
|FSLR||First Solar Inc||27.6||28||2.6||9.30%||Apr-12|
|UNG||United States Natural Gas||18.7||19||1.1||6.00%||Apr-12|
ATP Oil & Gas Corporation (ATPG) is currently trading at $7.87. Its 52 week range is between $5.53 and $20.19.
iPath S&P 500 VIX Short-Term Futures ETN (VXX) is currently trading at $26.03. Its 52 week range is between $19.88 and $59.18.
First Solar Inc (FSLR) is currently trading at $27.63. Its 52 week range is between $27.5 and $163.
Netflix Inc (NFLX) is currently trading at $107.13. Its 52 week range is $62.37 and $304.79.
United States Natural Gas (UNG) is currently trading at $18.66. Its 52 week range is between $18.68 and $50.56.
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
- A World Without Fractional Reserve Banks And Central Planning | ZeroHedge
- U.S. Warms to Clean Energy | Financial Sense
- Obama Makes Another Ukraine Statement: Live Webcast | ZeroHedge
- Merkel Slams US Hegemony? "America Can't Solve All The World's Problems Anymore" | ZeroHedge
- Two Stocks To Watch | iBankCoin.com
- Dropping Oil Prices Threaten Moscow’s Budget | Financial Sense
- Pending Home Sales Drop YoY For 10th Month In A Row | ZeroHedge
The most relevant financial news and articles from the Internets
- McIlroy can't wait to get busy at Ryder Cup | Business Insider
- GDP GROWTH REVISED UP TO 4.2%! | Business Insider
- Scottish People Are Selling Their Independence Votes On eBay (EBAY) | Business Insider
- Here's Why Alibaba Is Becoming A Huge Threat To Amazon And... | Business Insider
- It's No Coincidence -- Stocks and Auto Sales Are Both Frothy | TheStreet.com
- The UK's Conservative Government Just Suffered An Embarrassing... | Business Insider
- Unusual 11 Mid-Day... | StreetInsider.com