|IRS: Are You A Trader Or An Investor?
Imagine you executed 1,543 trades in a year. Would you consider yourself a "trader"? One unlucky taxpayer thought he was but the IRS said "no", thus denying him trader status.
For tax purposes, trader status has several advantages: You can deduct margin interest, investment seminar expenses, home office expenses, and more... and none of it is subject to the 2% rule for deductions. Furthermore, you are not limited to the $3K/year capital loss rule.
However, saying you are a trader and having the IRS agree you are a trader can be two different things. See our article Trader Status For Covered Call Investors for tips and examples of what is and is not (in the eyes of the IRS) legitimate trader status.
Taxes On Covered Calls
And while we're on the subject of taxes, which can be tricky for covered call writers, you may want to brush up on Raymond James' 9-page PDF download on Options, Puts, and Calls: Tax Planning. And for our Canadian friends, TMX Group's 15-page PDF download on Equity Options Tax Regime.
|3 Tech Stocks For March Covered Calls
A couple weeks ago Tom Taulli of InvestorPlace wrote about 3 beaten down tech stocks that he felt were worth buying: IBM, CSLT, and YELP. We agree with him that IBM and YELP are reasonable tech stocks, but CSLT has so little option activity that it is a poor choice for covered call investors, so we substituted another (AAPL).
Our article shows several ways to earn over 1%/month (12%/year) with our 3 tech stocks, including in-the-money, at-the-money, and out-of-the-money choices for the weekly March 6 expiration as well as the monthly March 20 expiration. See 3 Tech Stocks For Covered Calls.
|Born To Sell Wins 1st Place (Again)!
Born To Sell is proud to announce that we won the highly competitive TraderPlanet award in the Trading Software category! Our 2nd year in a row with a 1st place finish.
Out of 5 finalists, the winner was chosen by popular vote and announced in February. We appreciate everyone who turned out to vote for us. Thank you! You keep voting and we'll keep making great covered call software.
|AAPL Income Trades
Apple was on a tear seldom seen in February, rising from 118.05 at the start of the month, and closing at 128.46 at the end of the month. That's a 10.41 point gain, or 8.8%, in a single month. Not too shabby... adding around $60B of market cap in a month. (side note: only 217 companies even have a market cap larger than $60B)
AAPL remains our favorite company to write weekly covered calls on (and we're not alone; currently AAPL is at the top of our Top 10 covered calls held by our subscribers, and it is also the top Watchlist stock on our subscribers' watchlists). AAPL options (including the weeklys) are extremely heavily traded, resulting in small spreads and easy fills. Plus, the stock is volatile enough to create some great returns, even for in-the-money and deep-in-the-money short term options.
At the start of Feb we posted an article about AAPL income trades, showing 5-day, 12-day, and 20-day covered calls with annualized returns up to 73%. All 12 of the in-the-money buy-writes mentioned finished above the strike prices we gave, for an outstanding Feb track record. See
AAPL Trades For February 2.
And, if you're currently holding AAPL you might enjoy the article How To Protect Your Gains In Apple Stock Like A Pro.
|AAPL And 3 Other Covered Calls For Mar 20 Expiration
With three weeks to go until the March options expire, the top 4 covered calls Born To Sell members have written are (in order of popularity):
(Note: Born To Sell members have access to the full Top 10 Covered Call list, as well as having this list update real-time as members change positions. These are not recommendations, they are merely a reflection of our members' current positions.)
|AAPL And Other Covered Call Watchlist Stocks
Currently, the top 8 stocks Born To Sell members are using for their Watchlist are (in order of popularity):
(Note: Born To Sell members have access to the full Top 20 Watchlist, as well as having this list update real-time as members change their watchlists. And, you can have the highest yielding covered calls from your personal watchlist emailed to you after the close each day. Never miss a fat premium from your watchlist again!)
|Want More Covered Call Goodness?
Born To Sell is dedicated to only one thing: Making Money With Covered Calls. Our subscribers have access to state-of-the-art covered call screeners and covered call portfolio management tools. For less than the profit of a single trade you could be enjoying recurring monthly income using our tools. Three subscription types to choose from:
|Quarterly||$149.95 (17% discount)|
|Annual||$499.95 (31% discount)|
Plus, all subscriptions begin with a no-obligation 2-week free trial. What are you waiting for? Start collecting premium today!
The Born To Sell Team