Selling Covered Calls Is Easier Than It Sounds

Financial investors have found themselves chastened of late. The stock market crashes which were once incredibly rare became commonplace a few years ago, and many people who had invested much of their savings into the markets found that they were left with very little. What was left, they generally hoarded or put into low interest paying bank accounts with secure and large companies who were not likely to go under. The more extreme placed it in a box under their mattress. Even now there is still a widespread wariness about involving oneself in the markets too heavily, which is why a strategy such as selling covered calls is so ideal.

Before going any further, it is vital to point out that as has always been the case (and as people began to recognize when the previously bountiful stock markets stopped paying out), there is no guaranteed path to profitability. Get rich schemes do not exist: people know that. This certainly is not one of them. However, it is the perfect way to dip a toe back in the waters of the finance world without risk of drowning in debt.

Actually, the market is perfectly positioned at present for this strategy. It has almost bottomed out and could not feasibly drop much lower. Additionally, it seems likely to be flat as a pancake for the foreseeable future. But in the long run, things simply have to get better.

A flat market which has almost bottomed out is hugely vital for this strategy. It involves people being able to make small profits and guard against significant losses by choosing to sell call options on a product of their choice. If regular trading is deep sea diving, this form of investment is lazing in the paddling pool in the back yard.

Driving this fear of hurtling headlong back into the markets is the worry that it could all go catastrophically wrong again. A conservative, measured investment strategy is the way forwards. People are taking it up.

By selling the call option against a stock which a person has bought, they have the potential to do this. If somehow the price of a product decreases, losses are generally negligible up to a certain point. Essentially, this gives a buffer of security for an investor.

For those who are not yet sure about the stability of the market, this is perfect. Selling covered calls allows people to try it out without fully committing, in case things go south once more. It is the sensible choice for a smart investor.

The Born To Sell site is all about good covered call investing. Selling covered calls is a time-tested strategy carried out by many retail and professional investors. See

Share and Enjoy:
  • Print
  • Digg
  • Sphinn
  • Facebook
  • Mixx
  • Google Bookmarks
  • Blogplay

Tags: , , , , , , , , , ,

Leave a Reply