In a previous blog article, “Hurricanes – Insurance – Options Investing“, we outlined a covered calls stock options strategy for the property & casualty segment of the insurance industry. Using PowerOptions SmartSearchXL stock options search tool, we discovered two attractive covered calls positions.
The stock price of both positions dropped after entering the covered calls stock options position, but the positions were still profitable at stock options expiration generating a return of +0.5%, illustrating the beauty of covered calls stock options investing.Once again, we will consider covered calls stock options for the property & casualty segment of the insurance industry. Using PowerOptions search tools, the following covered calls stock options positions were found with stock options expiring in January of 2006:
| SmartSearchXL covered call search for November 28 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Stock Sym |
Stock Price |
Option Sym |
Expire &Strike |
Opt Bid |
%Dnsd. Prot |
%If Unch. |
%If Asgnd. |
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| BER | 35.18 (+0.73) | BERAG | 07 JAN 35.0 (53) | 1.10 | 3.1 | 2.7 | 2.7 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| HIG | 85.49 (unch.) | HIGAQ | 07 JAN 85.0 (53) | 2.65 | 3.1 | 2.6 | 2.6 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| AIG | 70.26 (+0.01) | AIGAN | 07 JAN 70.0 (53) | 1.75 | 2.5 | 2.2 | 2.2 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
All of the above covered calls stock options investing positions are in-the-money [ITM] with potential returns ranging from 2.2% to 2.7% (53 days) with downside protection ranging from 2.5% to 3.1%. ITM covered calls stock options generally provide more downside protection than out-of-the-money [OTM] covered calls stock options positions. OTM covered calls stock options positions generally provide more potential return, but require the underlying stock price to appreciate in order to realize the maximum potential return.
PowerOptions provides a free 14-day trial of its service. So join PowerOptions today, and you too can start reaping the benefits of the covered call investment strategy.
PowerOptions provides Internet based tools for analyzing stock options with specific search criteria and for finding potentially lucrative option income. For those seeking to execute a covered call investment strategy for their personal portfolios, PowerOptions provides an Internet based search engine for finding potentially lucrative income producing covered call stock options positions.
PowerOptions’ sister company PowerOptionsApplied provides expert stock option trading recommendations. PowerOptionsApplied specializes in covered calls, iron condor and selling naked puts stock options strategy recommendations. PowerOptionsApplied provides a 30-day risk free trial of its service.
[tags] blog, covered call investment strategy, investment strategy, iron condor, option income, poweroptions, selling naked puts, stock option trading, stock options[/tags]