Do covered call strategies shine in ‘flat markets’? The answer may surprise you
As a child, I sat too close to the TV, cracked my knuckles, and swallowed more than a few pieces of gum. If all of the legends I heard in childhood were true, I would now be a visually-impaired, middle-aged man with arthritis and tummy full of undigested gum. I cannot escape aging, but thankfully, those other things proved to be myths.
Life is full of myths and misconceptions – and the investing world is no exception. Covered call writing strategies are the subject of some of the most persistent investor misunderstandings. Promoters of covered calls writing strategies argue that the strategy excels in flat or range-bound markets.
The argument goes something like this: While selling call options gives away upside, the strategy’s…
