Covered Call Picks (VRNG,AEGR,ALXA,SRPT,GMCR)
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.
|VRNG||Vringo Inc||5.43||5.5||1.6||28.50%||November 2012|
|AEGR||Aegerion Pharmaceuticals Inc||14||15||2.3||16.50%||November 2012|
|ALXA||Alexza Pharmaceuticals Inc||5.63||6||0.8||14.20%||November 2012|
|SRPT||Sarepta Therapeutics Inc||32.9||33||3.9||11.90%||November 2012|
|GMCR||Green Mountain Coffee Roasters Inc||22.5||23||2.5||11.10%||November 2012|
Vringo Inc (VRNG) is currently trading at $5.43. Its 52 week range is between $0.68 and $5.55.
Aegerion Pharmaceuticals Inc (AEGR) is currently trading at $13.97. Its 52 week range is between $11.75 and $17.72.
Alexza Pharmaceuticals Inc (ALXA) is currently trading at $5.63. Its 52 week range is between $2.55 and $14.8.
Sarepta Therapeutics Inc (SRPT) is currently trading at $32.85. Its 52 week range is between $2.6 and $45.
Green Mountain Coffee Roasters Inc (GMCR) is currently trading at $22.53. Its 52 week range is between $17.11 and $96.77.
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
- The Fairy Tale Of Portugal's Successful Turnaround | ZeroHedge
- "World-Leading Economist" And Advisor To Chancellor Osborne Busted For Smoking Crack | ZeroHedge
- GDP Shocker: Atlanta Fed Calculates Q1 Growth Of Only 1.2% | ZeroHedge
- Bottom in Oil and Energy Stocks Looks Suspicious | Financial Sense
- How Much Crude Oil Do You Consume on a Daily Basis? | Financial Sense
- Is the Media Trying to "Disappear" Rand Paul (Just Like His Father)? | ZeroHedge
- US Macro Weakest Since July 2011 As Goldman Affirms Global Economy In Contraction | ZeroHedge
The most relevant financial news and articles from the Internets
- Ten Things Only Bad Managers Say | BusinessWeek
- LIVE: Warren Buffett speaks on CNBC's 'Squawk Box' (BRKA, BRKB) | Business Insider
- How Hungry-Man's supersized frozen meals are defying every industry trend | Business Insider
- Kerry, Lavrov open tough talks on Ukraine, Nemtsov | Business Insider
- Latvian MEP says barred from entering Russia for... | Business Insider
- Samsung will get 'slaughtered' in 5 years, says the CEO... | Business Insider
- Lego Is for Girls | BusinessWeek