Wednesday, November 17, 2021

High Risk Covered Calls or Low Risk Covered Call Options











Are you an option trader ? Do you sell covered calls?

Today I just wanted to discuss how you can influence your levels of risk by several key factors when and if you sell covered calls.

For brevity, I am going to assume that you all know how to ¨sell to open¨ covered calls. If you do not know what  a covered call option is.....then this post may not be helpful.

What raises risk in a covered call scenario?

permit me to draft a list:

  • Selling covered call options way out into the future...such as 6 months or even 2 years into the future. The future is unknown and the more we try to predict long term results....the more risk we may encounter....due to unexpected market movements.
  • Using leverage to finance the purchase of the underlying asset. Using margin debt to finance your purchases of the underlying asset adds more risk to your portfolio. Not only must you prepare for interest payments on the money you borrow in your margin account, but you must prepare to prevent a margin call on your account, when/if your buying power becomes challenged by negative market forces or poor investing choices.
  • Selling covered calls on equities that have an unproven financial record can/may add more risk to your accounts. When investors choose to sell covered calls on publicly traded companies that have no positive financial reports, they add unintended risk to their holdings.
There are several ways to minimize risk when selling covered calls on your stock portfolio. 

Permit me to draft another list:

  • Sell covered calls on stock that you have paid for in full....(without leverage)
  • Sell covered calls on companies with proven sound financial management, that produce healthy price to earning ratios(p/e ratio) and have a good reputation. Have a healthy respect for positive earnings. What is trendy is not always a ¨good bet¨.
  • When you want to withdraw money from the premiums you have collected by selling covered calls, only do so after the contract has expired or been closed or assigned. This simple tactic will prevent unnecessary stress if/when a covered call position runs in a direction that you did not expect.
  • Last but not least...do not lower the strike below your cost. This is very important, so that you do not risk losing money on the difference between your net cost of stock and the potential inflow of cash if/when a covered call that you have sold gets ¨assigned¨. To be fair, it is important to note, that there may not always be a strike price available at the correct price point to make your trade profitable. Therefore you may have to just ẅait and hold onto stock that needs time to recover from a market dip. This is another reason why it is prudent to eliminate the use of debt/margin/leverage when purchasing equities....so that you will be able to weather market ups and downs..... while maintaining a stress free and dignified investing experience.
Well.... that is all friends, for today. If you are an option trader or investor, I am sure you have discovered a plethora of methods you can use to control and/or define your risk. There is nothing more important in investing than controlling risk.

May God bless your trading and investing as well as your learning journey.

Peace,

Carla.






Thursday, September 23, 2021

Knitting is for Old Ladies She said

I was aghast that day. It was the wife of someone close to our family. She stated rather loudly that knitting was for "old ladies." 

Well, let it be said that this woman is not known for elegant comments. And so, after all these years, I have learned to just ignore ignorant comments and pursue whatever I wanna do....no matter what anyone says.
Life is too long and life is too short to really give a rip about what anyone says anyway. Do you agree?

And for the record, if I become old while still knitting the way I love to...then hallelujah...I will be a grateful camper.



And so, on that epic note, I bring to you my 3 hour slippers, which I knit without a pattern.
I don't know why I hate knitting patterns...Hmmmm....maybe it's for the same reason that I hate aerobics classes. I hate being told what to do by an instructor. I also hate being told what to do by a pattern. Lol....kinda amateur on my part...but I is what I is ")

I want to encourage those of you who, like me, have trouble following or even looking at a pattern. Just because you don't like knitting patterns, doesn't mean you shouldn't knit. You may be more creative than everyone else combined, simply because you want to do things your own way.....you prolly should!

Being creative and using what I have has allowed me to make things in a "logical" way as it pertains to my own style of doing things. I am not aiming for a pair of slippers to wear to the Met gala....I am aiming for something that fits my foot and doesn't cost too much to make. I want to be able to make it in a day or two...and I want the idea to be so simple and do-able that I could teach almost anyone on the spot to make them too. And so above, are the photos of my 3 hours slippers. Enjoy.

P.S.

Just because you don't like maps, doesn't mean you hate driving. I love driving!
Just because you don't like aerobics classes doesn't mean you hate aerobics! I love dancing!
Just because you don't follow recipes,doesn't mean you can't cook! Got it? Good :)

Peace out,
Carla.







Monday, September 6, 2021

When Ladies Level Up.... You might be Called This


I hate to break it to you....but if you are really focused and intelligent and ambitious, you are going to attract a few negative labels. Not to get too detailed... but one name that is often directed at us ambitious ladies
is the "B" word....and yes it rhymes with ditch.

The other word you might be called if you are ambitious and intelligent is the 
a slang word for a lesbian...and it rhymes with "bike."

There's no need to get upset....just prepare yourself for when it happens. Maybe you will be lucky and it won't happen...but be prepared none the less. Those who hurl insults at you are not worthy of your attention. They do not deserve your tears or your compassion. Gather yourself together and move on.

If you stay focused on your goals, you must know that the girls who live the "status quo" are not going to be impressed with your ambition. They do not have any goals other than to tear you down from your journey. 

They are more concerned with trying to know you down so that they can feel better about themselves. They are consumed by gossip and have no love for God and no respect for the holy Scriptures.
Don't let them win....You must NEVER let them win. 

When and/or if you get called names in person or on social media, just keep going. Sometimes there is a spiritual backlash towards people when they level up. It's all a part of the journey. It is always a shock when someone of our own gender attacks one of our own when we level up. Remember girls..... it takes a lot of maturity to celebrate another's gal's success and congratulate them. We must all develop the ability to celebrate someone's achievements even when they are a level above us. It's called "paying it forward". The grace and delight that you show when congratulating others in their achievements will no doubt come back to bless you when it is your turn to shine. The ripple effects of staying positive and keeping a great attitude continue on into your future for many years. The joy and gratitude multiplies.

Sometimes it is worth a shout of "Hallelujah" when you are thrown a derogatory name or label, because it just might be a sign that you are arriving very soon at the next level up in your journey. 

Hallelujah! You are on the right path!!

Stay strong, stay focused, stay intelligent. Don't dumb down. Don't give up. Don't worry. Don't get flustered. 

Stay strong, stay on plan. Stay on path. Stay on positivity . Stay on your goals.

Peacefully productive,

Carla.