Also, I was just using his “stock XYZ” example. Reading comprehension obviously isn’t your strength, I was never speaking to AMZN specifically.

It working out for one security proves nothing to me. I’m not saying the strategy is always a loser.

Mathematically doing this 1,000 times with 1,000 different stocks would underperform just holding those 1,000 stocks. I speak in generalities, not a random specific example.

Look at the performance of covered call index funds vs their underlying equities.

This post was edited on 2/27/26 at 4:39 pm

0 ...

Report Post

Posted by makersmark1

earth

Member since Oct 2011

20830 posts

Posted on 2/27/26 at 7:45 pm to bobaftt1212

quote:
In February I generated around 600 in option premium

I’ve done this with Verizon.

I’m sort of tired of owning it bc I doubt it has much growth over the next 25 years.

I sold calls over and over.

It finally moved up this year.

I will be rid of it at 40/45/50.

My basis was lower. Gain is long term.got a decent dividend over the years, but I’m winnowing my portfolio to be more ETF based for my family.

In general, most of my investment gains have been from dollar cost averaging and holding for long periods.

This post was edited on 2/27/26 at 7:56 pm

0 ...

Report Post

Posted by CecilShortsHisPants

One Foty Fo uh uh Magnolia Screet

Member since Oct 2012

3774 posts

Posted on 2/28/26 at 5:38 pm to TigahsOnTop

quote:
The EXPECTED RETURN of a covered call strategy underperforms the underlying equity in the LONG RUN

I could sell weekly covered calls WAY OTM and have a 99.99% chance of never being assigned, (if I was, great, it probably ran too far too fast and will pull back anyway) all the while collecting tiny little premiums, like $5 a week for example…

In that case, the EXPECTED RETURN of covered calls would absolutely outperform the underlying equity in the LONG RUN.

1 ...

Report Post

Posted by makersmark1

earth

Member since Oct 2011

20830 posts

Posted on 3/1/26 at 6:19 am to CecilShortsHisPants

I missed out on the Seafate big move bc I had sold calls at 125 on shares I got in the 50s.

I thought a double was decent in a relatively short time.

I was wrong.

I’ve also sold calls in DIS. It’s been dead in the water. The call premiums have been ok, but I probably should have just exited the position totally.

I sold some XOM calls recently. Now we may zoom to 225 bc I agreed to 180.

I am trying to reposition my holdings with less individual stocks. In the retirement accts with no tax consequences, it’s easier to adjust. In the regular account, I don’t like paying capital gains tax so I’m moving slower.

Page 1 2 3