Buying Covered Calls Online

: You use this when you expect the stock to stay flat or rise only slightly.

To execute this, you must own at least of the underlying stock for every 1 call option contract you sell. buying covered calls

: You generate instant income (the premium), but you cap your potential profit if the stock price skyrockets above the strike price. : You use this when you expect the

A is a strategy where you sell the right to buy stock you already own to someone else in exchange for an immediate cash payment called a premium . It is "covered" because if the buyer exercises their right, you already have the shares to deliver. 1. How the Strategy Works buying covered calls