Cycle Trading

[Duma]

Have several option strategies that I am starting to use. Ran across a new one I had never heard of before a couple of weeks ago (and I have a bookshelf full of option books).

All the books on selling coverd calls, always talk about selling calls that are OTM, such as buy a stock for 100 and sell a 105 call. This new strategy uses ITM calls. This is where the downside protection comes from.

How about a strategy that returns 50% a year with 10% downside protection. I opened up this trade on Fri.

ZEUS closed Fri at 20.95

Bought 100 shares 20.89
Sold a ITM Nov 13 20 call for 1.80.
Break even 19.09, -8.6%
Expected Profit .91, 4.8% for 31 days
Annualized Profit 51%