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Rolling Down Our Put Positions: When and Why?
Rolling Down Our Put Positions: When and Why? When selling cash-secured puts, our breakeven stock price is the (out-of-the-money) strike price less the put premium. Our exit strategy guideline as to...
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Multi-Leg Option Trades: Understanding Calculations and Results + HOLIDAY...
Covered call writing involves a minimum of 2 legs: we are long the stock (own the stock) and short the option (sold the option). There are many times when we employ the position management skill and...
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Analyzing a Rolling Down Trade During an Extreme Short-Term Market Decline
Exit strategy opportunities must be taken advantage of with our covered call writing and put-selling trades. When there is a significant overall market decline in the short-term, there will be losses....
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Interpreting Exit Strategy Calculations Versus Final Calculations
Mastering option calculations is an essential skill needed to attain the very highest covered call writing returns. Although the Ellman Calculator will do most of the heavy lifting for us,...
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Covered Call Writing Quiz: Evaluating a Series of Trades
Managing our covered call positions is essential to our overall option-trading success. In July 2019, KA Lau shared with me a series of questions he developed based on a real-life trade. I felt that...
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The Poor Man’s Covered Call: Rolling Options in the Current Contract Month +...
Exit strategies are critical to our overall success whether using traditional covered call writing or the Poor Man’s Covered Call (PMCC). In this article, we will evaluate scenarios when share price...
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Rolling-Down On a Sharp Market Decline at the End of a Contract
Exit strategy opportunities may be created when there is a substantial 1-day market decline and we must be prepared to take advantage of these occasions. In June 2020, there was an 1800 point decline...
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