"4. After entering a trade which has broken out successfully, i.e., has risen quickly, place a written call option deep in the money. This protects against a sudden reversal and locks in a double profit - the rise in the stock and the time premium of the option."
Another myth.
The ASX Buy-Write Index has woefully underperformed the ASX200 Accumulation Index since it's inception.
Writing call options is just another hedge.
It reduces risk and it ultimately reduces returns.
As I said earlier, the market rewards risks.
It's all about risk-reward.
Fundamental.
.
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- clarkkent
clarkkent, page-43
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