Covered Calls

[gtober]

LOL. Ok, got it. One thing I might add is consider not waiting until expiration. If it is apparent that the option will expire worthless any way, buy it back for little to no time premium, and re-write the next month when there is still a really juicy time premium. If you are spinning your wheels for just one week per month, you're losing potentially 1/4 of your earning power.

One thing I have found is that covered call writers are cheating themselves a bit by waiting around until expiration. There is time premium to be had. Truth be told, in my options portfolio - where I basically buy and hold and write options (or trade) around the position - I am usually 2-3 months out on expiry. That's where the best time premium is, and is the sweet spot in terms of TP degradation.

This is much more easily done if you are planning on keeping the stock for some time, however. If your just 'trading' this is more difficult to time properly.