So a classic textbook covered call option is assuming the stock was 50 and you are writing covered call for a strike price at 55 in a month for lets say $7. Usually the story ends here, so if the stock rises above 57 to 60 your stocks are likely get exercised and you under perform the market.
However, what if when the stock rises to 57 you purchase the same amount of the stocks you covered call at 57. At this case you didn't miss the up rising opportunity. Anyone please point out any flaw. By doing this you almost hedge any potential losses.
Submitted October 08, 2017 at 03:22PM by KingOfAwesomeLand http://ift.tt/2g2y3JR
