Covered Call Writing Requirements

In order to write covered calls you will need:

  1. A brokerage account (we do not handle cash or execute trades here). You can also write covered calls in most retirement (e.g. IRA) accounts.
  2. Permission to do covered call writing. Many brokerage accounts allow writing of covered calls by default. If not, your broker has a simple form you fill out in order to sell call options in your account.
  3. 100 or more shares of stock, or enough cash to buy 100 shares. Ideally, for diversification, you will have enough stock or cash so that you can own 100 shares of several different companies.
  4. A high-quality trade selection and portfolio monitoring service (you're here!).

covered call writing

Writing covered calls is a simple investment strategy you can do. It does not take much time to learn, execute, or to follow the trades. Anyone can write covered calls on stocks they own. It's the first options trade most people learn when they start trading options, and it's also the most popular options-based trading strategy (4 out of 5 option investors write covered calls). Let's see how it's done...

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