Category Archives: Trading Strategy

A strategy to cash in on both Dividend + Option Premium

Posted on August 29, 2013 by admin

When a dividend paying stock also has options, one way to cash in on both the dividend and the option premium is to write an ITM covered call right before the ex-dividend day. Take WHX.  WHX’s Sept. 13 calls for … Continue reading →

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Roll up my FFIV calls.

Posted on July 13, 2011 by admin

I was short FFIV calls (in a covered call) expiring this Friday at strikes of $97.5 and $100.  With FFIV advancing to above $110, I have 2 choices: 1. to buy back to cover those short calls; 2.  to buy … Continue reading →

Posted in Today's Trade, Trading Strategy | 6 Comments

CRM: I rolled up my short options for more time value.

Posted on May 20, 2011 by admin

CRM reported good earnings.  My covered call (short May 21 $125 call) is due today.  CRM is a good stock with good time value and I want to keep it.  So I bought back the call (strike 125) and sold … Continue reading →

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OPEN: A case study of how to roll up.

Posted on May 19, 2011 by admin

OPEN: We started a position on OPEN on 3/21/11 with a covered call (April 16, $90), cost 86.8.  On 4/14/11, OPEN was above 104.  We rolled up the April call to May 21, $90, for an additional profit of $2.7. … Continue reading →

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Why covered calls?

Posted on May 12, 2011 by admin

I use covered calls as my main trading strategy.  I do so for several reasons. Steady profit Less risky than owning stocks alone Guaranteed profit from premium selling. What is a Covered call?  Covered call means that you buy certain … Continue reading →

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Bidu: how to hedge

Posted on April 25, 2011 by admin

Bidu is scheduled to report earnings in 2 days (Apr. 27th).  I usually don’t trade issues before earnings (too risky).  However, I placed some Bidu bullish trades today. Today’s trade: Bidu spread: Long 135 call, short 140 call, expire in … Continue reading →

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Today’s Trade: Roll Up FFIV calls

Posted on April 21, 2011 by admin

Today is the last trading day of the week.  We are having a terrific week so far.  FFIV went up a lot, leaving my FFIV 95 calls expiring today in the money.  As a result, my long FFIV shares are … Continue reading →

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Case study of covered call & roll up.

Posted on April 15, 2011 by admin

The following example shows how to profit by using covered call + roll up (call spread).  The following case generated 15% return in 3 weeks, while FFIV’s price changed from 95.67 to 94.69, only about $1.  If you bought and … Continue reading →

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