How to backtest a covered call strategy before risking real capital. Five-step framework, realistic frictions, and the metrics that separate spreadsheet wins from live results.
How to backtest a covered call strategy before risking real capital. Five-step framework, realistic frictions, and the metrics that separate spreadsheet wins from live results.
Covered call diversification rules that turn a covered call book into a true income portfolio. How many tickers, sized how, across how many sectors.
A clear covered call exit strategy decides whether to close, roll, or let an option expire. See the rules, triggers, and a real AAPL example.
TL;DR The default covered call position sizing rule is 3 to 5 percent of total portfolio per single stock and 15 to 25 percent per broad ETF. No single sector should exceed roughly 20 percent of the income sleeve. Typical retiree portfolios hold 10 to 18 covered call positions, which captures most of the diversification… Continue reading Covered Call Position Sizing: How Much Capital Per Trade?
Covered call assignment avoidance with five techniques. Roll up and out for a credit, pick lower deltas, dodge ex-dividend dates, and keep your shares.
Earnings Season Can Be the Most Profitable Time for Covered Call Writers — Or the Most Dangerous Every quarter, like clockwork, the market enters a six-week window where nearly every major stock reports its earnings. And every quarter, I get the same question from students: “Mark, should I keep my covered calls open through earnings,… Continue reading How to Trade Covered Calls During Earnings Season (The Right Way)
Protect your covered call portfolio with five layers of defense including premium buffers, collars, portfolio construction, legal structures, and tax.
The Profit Is Right There in Front of You — The Question Is Whether You Take It One of the most common questions I get from students — and one that separates disciplined income investors from emotional traders — is this: “Mark, my covered call is profitable but it hasn’t expired yet. Should I close… Continue reading When to Close a Covered Call Early: Exit Rules Every Income Investor Needs
Learn how the collar strategy combines covered calls with protective puts to limit your downside risk. Includes real trade examples, zero-cost collar setups, and when to use collars vs. standard covered calls.
My Risk Management Rules for Covered Calls (After 40+ Years in the Markets) Here’s something most people won’t tell you about covered calls: the entry is the easy part. You buy 100 shares, sell a call, collect premium. Done. The hard part — the part that separates consistent income earners from everyone else — is… Continue reading The Complete Guide to Covered Call Risk Management: Protect Your Portfolio While Collecting Income
