Covered Call Picks (DVAX,CSCO,FB,NFLX,FSLR)
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.
|DVAX||Dynavax Technologies Corp||4.74||5||0.5||10.50%||November 2012|
|CSCO||Cisco Systems Inc||16.9||17||0.5||2.80%||November 2012|
|FB||Facebook Inc||19.9||20||0.6||2.80%||November 2012|
|NFLX||Netflix Inc||79.6||80||1.8||2.30%||November 2012|
|FSLR||First Solar Inc||24.4||24.5||0.5||2.20%||November 2012|
Dynavax Technologies Corp (DVAX) is currently trading at $4.74. Its 52 week range is between $2.67 and $5.34.
Cisco Systems Inc (CSCO) is currently trading at $16.85. Its 52 week range is between $14.96 and $21.3.
Facebook Inc (FB) is currently trading at $19.86. Its 52 week range is between $17.55 and $45.
Netflix Inc (NFLX) is currently trading at $79.61. Its 52 week range is between $52.81 and $133.43.
First Solar Inc (FSLR) is currently trading at $24.4. Its 52 week range is between $11.43 and $51.89.
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
- Potential Runners For Monday | iBankCoin.com
- McDonalds Misses Revenue, Earnings Estimates: Blames Weather | ZeroHedge
- Retail Store Closures Soar In 2014: At Highest Pace Since Lehman Collapse | ZeroHedge
- S&P Rallies To First 5-Day Streak In 6 Months On No Volume | ZeroHedge
- Richmond Fed Rebounds But Wages Tumble To 12-Month Lows | ZeroHedge
- China Goes Dark: PBOC To Keep Goldbugs Clueless About Its Gold Buying Spree | ZeroHedge
- US Judge Rules DoJ Must Release Drone Killing Rationale Documents | ZeroHedge
The most relevant financial news and articles from the Internets
- The Woman Who Accused GitHub's Founder Of Harassment Is Slamming The... | Business Insider
- Why Tesla Motors Stock Is Higher This Morning | TheStreet.com
- Watch These Caterpillar Machines Play Jenga With Giant, 600-Pound Blocks [THE... | Business Insider
- 5 Tricks Advertisers Use To Make You Buy Their Products | Business Insider
- Here's Why The Supreme Court May Have A Hard Time Understanding A Huge Technology Case | Business Insider
- One Stunning Stat That Shows How Nike Changed The Shoe Industry Forever | Business Insider
- This Story Perfectly Captures Why You Don't Miss Deadlines At Apple | Business Insider