Thursday, August 15, 2013

Covered Call Screener To identify High Yield Covered Calling


There are free of charge screeners and subscription corporation screeners. Like most things in life, you get what you buy. The free ones (including those offered by online brokers) will give you basic screening but because these often work for you plan strategies beyond just covered calls they are seldom optimized for bite CC investors.

A piece of dedicated software, just around doing CCs, is really worth it's price. Good ones could possibly get integrated earnings release beginning and ending dates and ex-dividend dates, and then warn you if any of those dates occur before strategy for expiration. That will keep you out of trouble.

There is a popular strategy that involves writing high yielding in-the-money CCs from Stocks that (1) will not have an earnings announcement before expiration, and (2) may or may not have an ex-dividend meeting before expiration (doesn't issue, but isn't a requirement).

Custom Stock/option filters is applicable to limit the 200, 000 results to only those that meet your requirements and risk profile, which could include: yield, P/E ratio, market cap, option cost of, time premium, expiration calendar, moneyness, etc. Being able to slow up the universe of candidates right down to a handful using some of clicks is a powerful tool.

But chasing the highest yield is not the only answer. There is a the explanation for the call buyers are willing to pay up and if you do not know what it is then you haven't done so much. Make sure you're in a position to own the Stock long lasting if it should close it is in the strike price at cessation. If not, then don't get involved; there are too they can good companies such that there is no need to mess around with ones you won't want to own long term.

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