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Podcast: Steady Wealth Podcast
Episode: Why Covered Calls Make Sense Now
Description: Covered call strategies are an investment technique that can generate income on a portfolio of stocks, or even without a portfolio of stocks. This strategy has been previously overlooked, but it works in both bull and bear markets. It is essentially a neutral to bullish strategy where an investor sells an out-of-the-money call against every 100 shares of stock they own, while simultaneously collecting a premium. If the option expires, the trader can keep the stock and sell against it again. If the worst-case scenario happens and the stock is called away, the trader still keeps the premium earned.
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