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Suze Orman Endorses Covered Calls

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Uploaded by on Mar 3, 2008

Suze talks about Covered Calls and why she likes it.

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Education

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Uploader Comments (BlueCollarInvestor)

  • Most covered call writers should use an online discount broker. I pay $5.95 per stock and option transaction up to 1000 shares and an additional $0.75 per contract for options. If you invest $10,00 and generate a 1-month income of $330, your brokerage fee would be less than $20.

  • can you protect your downside if your stock goes down on covered call?

  • Yes, absolutely. Simply buy back the option and now you can sell the stock or another option. This is what so many detractors don't understand. There is no one strategy that is right for everybody but you do need to be informed to make an educated decision.

  • CC writing is a great strategy that requires the option seller to protect against share depreciation. One way is to buy a protective put as suggested in one of the comments above.

    I prefer to execute one of the many exit strategies available to us like rolling down or closing the short call position and selling the stock.

    The best approach is to educate yourself before involking this strategy, paper trading and then designing a well-thought out plan. Do this and success is inevitable.

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All Comments (20)

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  • I write covered calls every month. I also buy put contracts for every 100 shares i own. I will not ever buy stock without put contracts. I don't like risk. There are many strategies to use in the market. I have nothing to sell, just saying. I make and average 10-15% a month, return on equity. Don't just take suze's word. Do your research and make sure your getting un biased information! That way you can make informed investment decisions.

  • CC is pure stupidity !!!

  • hey guys i like this video but enjoy this

  • how about credit spreads for income

  • What percentage of covered call income is lost to brokerage?

  • @finwest

    Then shut up and don't listen or comment jack!

  • Covered calls were easy pickins' back in the 90's, used to love them, and there's still some great potential today in the right markets...premiums just aren't what they used to be using similar tactics.

  • "no upside potential and no downside protection! ". I agree with you partially since she says that cover calls are good when stocks are trading sideways. I found her too loud mouthed and lacking in fineness, but she stipulated the setting where cover calls are suitable.

  • I just started doing covered call yesterday.

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