When you think about investing, selling options for income might not be the first strategy that springs to mind. Investors use options to hedge their positions and traders use them to make quick ...
It can feel like free money to sell options. You generate immediate income, while actually living out the risks comes later on. So it’s easy to discount the real risks when you’re selling ...
One strategy for earning income with derivatives is selling (or "writing") options to collect premium amounts. Options often expire worthless, allowing the option seller to keep the entire premium ...
Option premiums are taxable as ordinary income. That could be costly if you’re in the top federal tax bracket of 43.4%. And, of course, the premium you earn from selling a call may offer little ...
(ticker: MSFT) could sell a contract allowing another investor to buy their Microsoft shares at a set price before the option expires. "For income-focused investors, covered calls offer a way to ...
Selling the call option generates an income of 1.3% in 121 days, equalling around 3.78% annualized. That assumes the stock stays exactly where it is. What if the stock rises above the strike price ...