Investors seeking income in this volatile market can still sell covered call trades for both income and downside protection. In the past month, the S&P 500 produced a return of 0.73%. However, subscribers to the Get Rich Monthly Income Plan made off with a 4.7% return by trading a covered call on United Rentals (URI). Here is the trade posted in July:
Covered Call on United Rentals (URI)
STRATEGY: Look at the August 55 covered call. For each 100 shares of United Rentals (URI) stock you buy, sell one August 55 covered call option for a $52.53 (55.63 – 3.10) debit or better.
Actions: URI is currently trading at $55.01 so the 55 call we sold is ATM. These shares and call options should be closed on Friday (08/16) for a 4.70% assigned return.
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