A popular options trading strategy to generate income through options premiums. To execute this call, an investor holds a long position in an asset while selling call options on that same asset. It is a strategy utilized by an investor who plans to hold an underlying stock for a long time but doesn’t expect a substantial price increase in the near future. This is ideal for investors in relatively stable stocks. This makes covered calls a neutral trading strategy.
Covered Call
Market Terms
We don't know everything about the markets. We're just devoted to learning. Taken from those smarter than ourselves, here's how we define Covered Call.