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A covered option is a financial transaction in which the holder of securities sells (or "writes") a type of financial options contract known as a "call" or a "put" against stock that they own or are shorting. The seller of a covered option receives compensation, or "premium", for this transaction, which can limit losses; however, the act of ...
How do covered call ETFs work? A covered call is a call option that an investor writes on a stock they already own. By selling a call on the stock, the investor earns a premium, while the buyer ...
The Global X S&P 500 Covered Call ETF's yield is an eye-catching 9.2%. ... But I'm investing in an option income ETF for the express purpose of collecting and using the dividends. I'm not sure who ...
Essentially, the ETF sells covered calls to generate income that it can pass on to shareholders. This is a common investment approach that can actually benefit from volatility, since the best ...
Options, including put options and call options, can be written or purchased on most ETFs – which is not possible with mutual funds, allowing investors to implement strategies such as covered calls on ETFs. There are also several ETFs that implement covered call strategies within the funds. [33] [34] [35]
A covered call is an options trading strategy that offers limited return for limited risk. A covered call involves selling a call option on a stock that you already own. By owning the stock, you ...