sr9web

Oil Above $50 and Still Has Legs - Cramer

buy pwe

Income in a Zero-Rate World

How's that GE at $13.09 doing?


On Feb 02 12:46 PM Mark in Honduras wrote:

> In a bear market, I like to write covered calls that are in the money.
> You can find calls that will pay you a 5% premium for one month and
> still give you a 5-10% cushion for falling prices. Take for instance
> GE; Last month I sold 7 covered calls at $1.91 with a $12 strike.
> I bought GE for $13.09/share. That gave a net 7% premium, which I
> will keep so long as the price does not fall below $12. If it falls
> below $12, my premium is reduced, but I keep the shares and will
> sell more calls as soon as the current ones expire.
>
> I figure if I can average about 5% monthly on calls, I can double
> the money every 15 months, without even counting any dividends.