WebApr 1, 2024 · A covered call provides protection against a decrease in the value of your shares. If you receive $2.50 in premiums, you have that dollar figure as protection if the … WebA Covered Call is a basic option trading strategy frequently used by traders to protect their huge share holdings. It is a strategy in which you own shares of a company and Sell OTM Call Option of the company in similar proportion. The Call Option would not get exercised unless the stock price increases. Till then you will earn the Premium.

Why use a covered call? - Fidelity - Fidelity Investments

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Covered Call Vs Protective Call (Synthetic Long Put)

WebSep 14, 2024 · Two common strategies are to reduce exposure by using a covered call (selling a call option) or to use a protective put (buying a put option). Covered Calls A … WebApril 13, 2024 - 5 likes, 9 comments - Scott Levoune (@scottlevoune_wealththroughprop) on Instagram: "I'm going to talk about the difference between principal and ... WebWith short call options, consider the difference between covered and uncovered calls. The latter instrument is also called a naked call. When your short call is covered, you already own the shares ... lilly air conditioning