§ 01
AAPL — Current Price, Dividend Yield. Open AAPL on the Ledge to see current values.
§ 02
| Strategy | Structure | Objective | Tradeoff |
|---|---|---|---|
| Covered Call | Own 100 shares + sell 1 call | Generate income from premium | Cap your upside at the strike price |
| Protective Put | Own 100 shares + buy 1 put | Insure against downside | Costs premium, reducing returns |
§ 03
Covered Call: Max Profit = (Strike − Stock Price) + Premium
§ 04
Covered calls work best when you expect the stock to trade sideways or rise modestly. If the stock surges past your strike, you miss the upside above it. If it drops significantly, the premium provides only a small cushion.
§ 05
Pick a stock you own in **Fundamentals**. Look at call options 5–10% above the current price with 30–45 days to expiration. How much premium could you collect? Is it worth capping your upside?
§ 06
You own shares at $100 and sell a $110 call for $3. The stock rockets to $130. What’s your total return?
§ 07
§ 08
You hold 100 shares of AAPL at cost basis $150, now at $200. You sell a $220 covered call for $4 premium. AAPL goes to $250. What happened?
Five questions · AI feedback
Sit with the ideas.
You own 100 shares of a stock at $100. You sell a covered call with a $110 strike for $3.00 premium. What is your maximum gain from this trade?
Why: