Covered Calls Using Dividend Stocks
Most people consider options to be risky and this is true with most option plays as 7 out of 10 options expire worthless if you are buying them. This can be attributed to the fact that there is a time limit to the options rights. The big difference in selling Calls is that the passage of time has a positive impact on this strategy. If 7 out of 10 don’t get exercised, this simply means that more often than not, you will keep the stock (and the call premium)past the expiration date on the option and sell another call the next month.