Summary

• Selling a covered call is a great way to boost the income you receive from your stock holdings.
• When you sell a covered call, it gives the buyer the right, but not the obligation, to buy your stock from you at a specified price (strike price) by a certain date (expiration date).
• When you sell an out-of-the-money covered call, your only risk is opportunity risk (although you can choose to buy the call back at a loss if you don’t want to give up your stock).
• You need to actively monitor your covered call positions. A covered call strategy requires more attention by you so you’re no longer snoozing your way to wealth.
• Selling out-of-the-money naked puts allows you to get paid to wait and see if a stock you’re interested in comes down in price, but it carries more risk than covered calls.
• Coffee doesn’t do a thing for me. Espresso, however, turns me into Jim Carrey on uppers.