Quite a few covered call sellers around because brokers actively promote covered call selling as a "safe" way to produce an income stream from shares to clients. The brokers get $35 - 50 in brokerage for every option trade though.
The professionals are the ones selling naked puts (and calls) though. They love to sell insurance to long put buyers because the demand for protection usually leads to inflated premiums and usually results in the put sellers taking all the value in the trade. The sellers are usually the winners in options.
Point taken that in the event of a plunge you are exposed but not more so than some one who just buys a stock the day before it crashes.
So like tbo, if one just sells puts on stocks they want at a price they would be happy to buy at, then it is just like getting paid to place a limit order below the market that expires.
I would think there are heaps of people who place an 18.00 order on a 20 dollar stock and don't get filled so with puts, it's the same except you get paid for it.
With your example of the up trending low volatility stock, it's better to sell in more volatile stocks when they go up as you get value in your premiums and then when volatility dies down you profit from volatility crush. So you can sell puts back to market cheap and turnover puts faster one expiry after another.
Implied volatility is often overstated and then the realised volatility doesn't live up to the forecast. Selling puts when you see stocks in high Implied Volatility percentiles or relative IV works well as IV reverts to the mean.
Then the only thing left is to spread the risk around so it's not all concentrated on one stock that can wipe you out. Personally I think it's all about the Greeks and learning how to use them as that's what professionals and market makers go by every day to stay profitable.
PS Loved 1984 but I thought it was a warning and not an instruction manual.
(20min delay)