Covered Calls

B

Blue_Bull

Hey everyone, I'm looking for a stock to sell covered calls against. To be specific, I'm trying to find a stock that pays a dividend, isn't a tiny and unstable company, and has enough IV to collect a decent premium on.

My first thought was MO, but that's got virtually no premium to sell. MCD isn't too bad, but its pretty unexciting.

Anyone have something better in mind?
 
Two that I like are ERF and O.
These pay a monthly dividend and have a semi-decent premium.
They are, however, more speculative that your standard blue-chips (being a Canadian Royalty Trust and a real-estate management company, respectively).

Caveats are that you pay tax on the Canadian dividend.

Keep in mind that decent premium is the result of volatility, so you can't have everything.
 
Quote from Blue_Bull:

Hey everyone, I'm looking for a stock to sell covered calls against. To be specific, I'm trying to find a stock that pays a dividend, isn't a tiny and unstable company, and has enough IV to collect a decent premium on.

My first thought was MO, but that's got virtually no premium to sell. MCD isn't too bad, but its pretty unexciting.

Anyone have something better in mind?
More...
selling cc against individual stocks is a bad idea. if you must sell cc sell against an etf or indexes. that way you eliminate specific stock risk.
 
Quote from Blue_Bull:

Hey everyone, I'm looking for a stock to sell covered calls against. To be specific, I'm trying to find a stock that pays a dividend, isn't a tiny and unstable company, and has enough IV to collect a decent premium on.

My first thought was MO, but that's got virtually no premium to sell. MCD isn't too bad, but its pretty unexciting.

Anyone have something better in mind?
More...

You might look at http://coveredcallsadvisor.blogspot.com/

(no affiliation)

p$
 
Quote from Blue_Bull:

Hey everyone, I'm looking for a stock to sell covered calls against. To be specific, I'm trying to find a stock that pays a dividend, isn't a tiny and unstable company, and has enough IV to collect a decent premium on.

My first thought was MO, but that's got virtually no premium to sell. MCD isn't too bad, but its pretty unexciting.

Anyone have something better in mind?
More...

General Electric.

Naked Puts on the 16 strike for Jan. You collect the dividend in the put premium (it is priced in with dividend)

Put in a sell to open limit of .88 cents tuesday on GEWMQ

Stick cash collateral + premium in interest bearing account.
 
Quote from vhehn:

selling cc against individual stocks is a bad idea. if you must sell cc sell against an etf or indexes. that way you eliminate specific stock risk.
More...

Agreed, SPY would be the best one in my opinion for someone more risk averse.
 
Quote from Blue_Bull:

Hey everyone, I'm looking for a stock to sell covered calls against. To be specific, I'm trying to find a stock that pays a dividend, isn't a tiny and unstable company, and has enough IV to collect a decent premium on.
More...
Hate to be a party pooper :) but do you think it might be an idea to believe that the stock recommendation that you take from repliers is going to range trade or appreciate a bit?
 
Quote from Blue_Bull:

Hey everyone, I'm looking for a stock to sell covered calls against. To be specific, I'm trying to find a stock that pays a dividend, isn't a tiny and unstable company, and has enough IV to collect a decent premium on.

My first thought was MO, but that's got virtually no premium to sell. MCD isn't too bad, but its pretty unexciting.

Anyone have something better in mind?
More...



VZ or T would be my sugguestions
 
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