• $49 Monthly
  • $125 Quarterly

Membership Options:

ETF Covered Calls Plus Portfolio
Portfolio Trade PageETF Covered Calls

ETF Covered Calls Plus

Very similar to the Conservative Covered Call  portfolio, the ETF Covered Call Plus portfolio chooses covered calls and diagonal spreads on exchange-traded funds or ETFs. This portfolio is best for options traders who might be comfortable with covered call trading but are interested in exploring other more complex options strategies.

The diversified nature of ETFs make them less volatile and therefore ideal for covered calls.

  • $49 Monthly
  • $125 Quarterly

Membership Options:

Product Description

The ETF Covered Call Plus portfolio chooses covered calls and diagonal spreads on exchange-traded funds or ETFs. This portfolio is best for options traders who might be comfortable with covered call trading but are interested in exploring other more complex options strategies.

The diversified nature of ETFs make them less volatile and therefore ideal for covered calls.

ETFs can be ideal for this strategy because their diversified nature makes them less volatile.

Covered Call Strategy Details

We choose 4-to-6 month covered calls with a target annualized return of 15% to 20%. Each trade in this portfolio assumes 100 shares of the underlying ETF and one option contract. The strike price of these sold calls for the covered call trades is often lower than the strike price for corresponding sold call in the diagonal trade, which is one of the reasons this strategy has slightly less risk.

Diagonal Spread Strategy Details

Our analysts create simulated covered calls by selling a short-term call while simultaneously buying a long-term call at a lower strike price. The goal for these trades is to generate a 25%+ annualized return.

Covered Call Ideal Result

In the best case-scenario, your calls are in the money at expiration. The sold calls are assigned and you deliver the ETF. That closes the position and delivers a full profit. If the ETF pays a dividend, you will also collect those payments while the position is open.

Diagonal Spread Ideal Result

In the best case-scenario, your sold calls are in-the-money during the week before expiration. In that case our analysts will often be able to exit the position for a larger profit than originally targeted. To do this, you buy back your sold calls and sell your long-term call for a net credit. When you exit these trades early, the credit will generally be larger than the difference between the strike prices of our options.

Product Features

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    Regular posts written by our analysts: market updates, educational articles, workshop replays and more.

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    A place to get started learning about options and brush up on what InvestorsObserver has to offer.

  • Guided Trades

    Trades picked and published by our analysts and then managed through close with regular updates to subscribers.

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    Regular workshops where our analysts present educational material about options, how to use our services and answer questions from subscribers.

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Investing in stocks, bonds, option and other financial instruments involve risks and may not be suitable for everyone.

Prior to buying or selling an option, a person must receive a copy of Characteristics and Risks of Standardized Options. Copies of this document are available at http://www.cboe.com/Resources/Intro.aspx or from your broker. Copies are also available from the Chicago Board Options Exchange, 400 S. LaSalle Street, Chicago, IL 60605. The OCC Prospectus contains information on options issued by The Options Clearing Corporation. Copies of this document are available from The Options Clearing Corporation, 440 S. LaSalle Street, 24th Floor, Chicago, IL 60605 or the Chicago Board Options Exchange, 400 S. LaSalle Street, Chicago, IL 60605. The documents available discuss exchange-traded options issued by The Options Clearing Corporation and are intended for educational purposes. No statement in the documents should be construed as a recommendation to buy or sell a security or to provide investment advice.