Covered Call Picks (VHC,AVP,TPX,END,SODA)
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.
|VHC||VirnetX Holding Corp||31||31||3||9.70%||Jun-12|
|AVP||Avon Products Inc||20.9||21||1.7||8.10%||Jun-12|
|TPX||Tempur-Pedic International Inc||49.9||50||3.4||6.80%||Jun-12|
|END||Endeavour International Corp||8.49||10||0.6||6.50%||Jun-12|
|SODA||Sodastream International Ltd||36.1||37.5||1.9||5.10%||Jun-12|
VirnetX Holding Corp (VHC) is currently trading at $30.99. Its 52 week range is between $11.01 and $41.77.
Avon Products Inc (AVP) is currently trading at $20.89. Its 52 week range is between $16.09 and $30.63.
Tempur-Pedic International Inc (TPX) is currently trading at $49.92. Its 52 week range is between $44.5 and $87.43.
Endeavour International Corp (END) is currently trading at $8.49. Its 52 week range is $5.8 and $16.43.
Sodastream International Ltd (SODA) is currently trading at $36.11. Its 52 week range is between $27.6 and $79.72.
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
- Puerto Rico Is About To Default: Your Complete Guide To An Island Debt Debacle | ZeroHedge
- With Mass Shootings, The State Makes Us Less Safe | ZeroHedge
- US Blames Afghanistan Hospital Massacre On "Malfunctioning Sensors," "Human Error" | ZeroHedge
- If "Everything's Awesome" Why Did Aussie CapEx Just Collapse By The Most In Its 30 Year History | ZeroHedge
- Another Data Point To Ignore - There Are The Most Distressed Bonds In 6 Years | ZeroHedge
- China Unleashes Perfect Storm Of Bad News Prompting Stock Market Plunge | ZeroHedge
- Meet The Man Who Funds ISIS: Bilal Erdogan, The Son Of Turkey's President | ZeroHedge
The most relevant financial news and articles from the Internets
- Bears D holds up late; Packers seek answers in passing... | Business Insider
- This tiny chip could charge your iPhone much faster | Business Insider
- One more memorable moment for Favre, Packers at Lambeau | Business Insider
- ESPN is losing subscribers by the millions | Business Insider
- Philippine website to seek tips on missing Marcos... | Business Insider
- The Latest: France focused on destroying IS HQ in Raqqa | Business Insider
- You'll feel like you own a private island at this resort in the middle of the ocean | Business Insider