Posted on February 11th, 2010 
admin 
The share price increases this is great for your trade and there are three things you can do:
1. Do Nothing
2. Roll out sold call for a small credit to avoid unwanted option exercise
3. Wait to be exercised and lock in profit
The share price falls there are a number of different things you can do with the covered call position:
1. Do Nothing
2. Close out of entire position sell shares and buy back sold call
3. Buy back sold call
- This will be bought back at a lower price and therefore locking in a profit.
4. Protect Capital
- Buy a put option to if you think the share price will continue to fall
- This will reduce the risk of the trade significantly
- More information on protecting shares from a fall can be requested.
To receive ASX Option Recommendations or to learn more about The Covered Call or The Buy – Write Option Strategies please request the Covered Calls eBook by contacting us on 07 5504 2244 or info@totaloptions.com.au
