In previous publications, laddering covered call strikes with the same expiration dates was discussed. This article will address scenarios when the ITM strikes remain ITM and the OTM strikes remain OTM at expiration. A real-life example with Alamos Gold Inc. (NYSE: AGI) will be analyzed.

AGI 5-day trade

• 12/15/2025: Buy 400 x AGI at $38.08
• 12/15/2025: STO 1 x $40.00 OTM call at $0.20
• 12/15/2025: STO 3 x $37.00 ITM calls at $1.45
• Pre-stated initial weekly time-value return goal range is 1/2% to 1% for both ITM & OTM strikes

Initial Covered Call Trade Calculations: BCI Trade Management Calculator (TMC)

• Red oval: 5-day trade
• Yellow field: Breakeven price points
• Brown cells: Initial time-value returns for the OTM $40.00 strike
• Purple cell: Additional upside potential for the OTM call strike (potential 2nd income stream from share appreciation)
• Pink cells: Initial time-value returns for the ITM $37.00 strike
• Blue cell: Downside protection of the ITM time-value return

Trade status after Expiration on 12/19/2025

• AGI closed at $38.48
• This is $0.40 above the price at trade entry
• I allowed the 300 shares to be exercised at $37.00 for a net gain of $111.00
• I am holding 100 shares at an unrealized gain of $40.00 and an option realized gain of $20.00
• Total 5-day realized + unrealized gain = $171.00 = 82% annualized

Discussion

Just as we have the opportunity to use different strikes for the same underlying security with the same expiration dates, we also have the flexibility to allow or prevent exercise and assignment of our shares. I could have bought back and rolled the ITM strike prior to expiration but decided to allow exercise and retain the remaining 100 shares to then write a covered call the following week. In essence, I had 4 successful contract trades and took some money off the table for the next contract cycle.

Stock Repair Calculator

What is the stock repair strategy?

• Own shares at a price higher than current market value (unrealized loss)
• Willing to forego potential profit in exchange for lowering the breakeven price point
• Not willing to add additional funds to the current losing position
• Instead of buying shares at the lower price to “average down”, an at-the-money (near-the-money) call option is purchased and funded by selling 2 out-of-the-money call options
• 2 long positions (stock and ATM or NTM call)
• 2 short positions (OTM calls covered by long positions)
• This action will lower the breakeven price point
• The strategy does not protect against additional downside loss
• The strategy does cap the upside

Click here for more.

Free training resources

Click here.

Your generous testimonials

Over the years, the BCI community has been incredibly gracious by sending our BCI team email testimonials sharing stories as to what our educational content has meant to their families. Moving forward, we have decided to publish several of these testimonials in our blog articles. We will never use a last name unless given permission:

1. BCI Educational Webinar #10: The Put-Call-Put (PCP) or “Wheel Strategy”

Thursday May 14, 2026, at 8 PM ET (LAST CHANCE TO REGISTER)

Using both covered call writing & cash-secured puts in a multi-tiered option selling strategy. A 68-day real-life example taken from one of Alan’s portfolios will be analyzed.

BONUS: Barry will share a real-life credit spread trade using our BCI Conservative Credit Spread Management System.

Discount coupons and a live Q&A session will follow the presentation.

Click here for more information and to register (scroll down).

2. Mad Hedge Investor Summit

June 3, 2026

12 PM ET – 1 PM ET

Covered Call Writing

Uncovering a 3^rd Income Stream in Our Investment Portfolios

Increasing profits and avoiding tax issues using stock options

You have owned shares of stock in your non-sheltered accounts for many years. Share value has been appreciated significantly over time. This has put a smile on your face. Many of these securities have also generated dividend income. This, too, has pleased you. However, there is a 3^rd income stream that you can activate right now, leveraging these same stocks, using a strategy known as covered call writing.

This is a low-risk option selling strategy analogous to generating rental income with a real estate investment property. Yes, renting out your stocks for limited periods. We have 2 goals: generate a 3^rd income stream + retain the underlying shares to avoid negative capital gains issues.

This presentation will analyze how to implement this form of covered call writing, known as Portfolio Overwriting, always with capital preservation in mind.

Details & registration link.

3. American Association of Individual Investors: NYC Chapter

Date and time to be confirmed.

Via Zoom.

More information to come.

4. MoneyShow Masters Symposium Las Vegas

July 20 – 22, 2026

Caesars Palace Hotel

Las Vegas

Details to follow.

5. Toronto Money Show

September 24 – 25, 2026

MaRS Center, Toronto Canada

6. Orlando Money Show

October 5 – 7, 2026

Hilton Orlando Lake Buena Vista

Details to follow.

One of our frequently used covered call writing exit strategies is rolling-out, where we buy back the current short call and sell a later-dated short call. This podcast uses a real-life example with NVDA where multiple rolling trades were executed, both rolling-out and rolling-out-and-up.

Calculations are shown using the BCI Trade Management Calculator and final 50-day trade results are calculated.

Free Resources:
https://thebluecollarinvestor.com/minimembership/bci-free-resources/

Premium Membership:
⁠https://thebluecollarinvestor.com/minimembership/premium-membership/

Best Discounted Packages:

1. BCI Package, our Best and most Comprehensive Investment package:
⁠https://thebluecollarinvestor.com/minimembership/bci-investor-program/

2. TCM Package – BCI Trade Management System:
⁠https://thebluecollarinvestor.com/minimembership/bci-trade-management-system/

3. CEO Package – Includes TMC Package:
⁠https://thebluecollarinvestor.com/minimembership/ceo-package/

4. Credit Spread Management System
https://www.thebluecollarinvestor.com/the-bci-credit-spread-management-system/

]]> https://www.thebluecollarinvestor.com/bci-podcast-171-rolling-out-to-impressive-profits/feed/ 0 https://www.thebluecollarinvestor.com/laddering-covered-call-strikes-based-on-market-assessment-and-risk-tolerance/ https://www.thebluecollarinvestor.com/laddering-covered-call-strikes-based-on-market-assessment-and-risk-tolerance/#comments Sat, 02 May 2026 09:17:32 +0000 https://www.thebluecollarinvestor.com/?p=213504

What strike should I select for my covered call trades? In-the-money (ITM), out-of-the-money (OTM), how far out, how far in? This apparent dilemma can easily be navigated by identifying our return goals, market assessment and personal risk tolerance. Another important factor is that, when selling multiple contracts, we can use different strikes, a process I refer to as laddering strikes. I borrowed this term from the bond market.

A Real-Life Example with Kinross Gold Corp. (NYSE: KGC) on 12/29/2025 (5-day, holiday-shortened trade)

• 12/29/2025: Buy 1000 x KGC at $27.60
• 12/29/2025: STO 8 x 1/2/2026 $27.00 (TM) calls at $0.92
• 12/29/2025: STO 2 x 1/2/2026 $28.50 (OTM) calls at $0.25

What are these strike selections telling us?

Of the 10 contracts sold, 8 were ITM, a defensive approach; 2 were OTM, a more aggressive approach. Overall, I was leaning defensively, with a cautious overall market assessment, which aligned with my personal risk tolerance at the time of these trades.

What about option premium return goals?

I, typically, target 2% – 4% per month and 1/2% – 1% per week. In these trades, I was at the high end of these ranges.

Initial Covered Call Trade Calculations: BCI Trade Management Calculator (TMC)

• Brown cells: The ITM strikes generated initial returns of 1.19%, 86.52%, with 2.17% downside protection of that time-value profit (purple cell)
• Pink cells: The OTM strike generated 0.91%, 66.12% annualized, with 3.26% of upside potential (blue cell)
• Green cells: A total of $306.00 in time-value premium was generated into my brokerage account

Post expiration results

• KGC closed at $28.30, leaving the $27.00 call expiring ITM and 800 shares were sold at $27.00
• The $28.50 strike expired slightly OTM, so 200 shares were retained
• The initial cash outlay for 1000 shares was $27,600.00
• The realized loss on the sales of 800 shares (ITM strike) was $480.00
• The unrealized gain on 200 shares is $140.00
• Net return on the stock side: -$340.00
• Net realized option premiums: $736.00 + $50.00 = $786.00
• Net realized/unrealized return is +$446.00 = 1.61%, 84% annualized (52 periods)

Discussion

• Significant returns can be generated with 5-day covered call trades even during holiday-shortened weeks
• Option trades can be crafted to align with all market environments and personal risk tolerance
• In the case of KGC, significant 5-day returns were initially captured and realized
• These are low risk, not no risk trades

THE POOR MAN’S COVERED CALL

Online Streaming video course with Downloadable Workbook

This program will highlight in great detail:

• PMCC definition
• Pros and Cons
• Risk/reward profile
• Best stocks and ETFs to consider
• How to construct a PMCC trade
• Hypothetical example
• Multiple real-life examples
• The BCI PMCC Calculator
• Option Greeks
• Position management
• Rolling LEAPS

Click here for a video & more.

Free training resources

Click here.

Your generous testimonials

Over the years, the BCI community has been incredibly gracious by sending our BCI team email testimonials sharing stories as to what our educational content has meant to their families. Moving forward, we have decided to publish several of these testimonials in our blog articles. We will never use a last name unless given permission:

1. BCI Educational Webinar #10: The Put-Call-Put (PCP) or “Wheel Strategy”

Thursday May 14, 2026, at 8 PM ET

Using both covered call writing & cash-secured puts in a multi-tiered option selling strategy. A 68-day real-life example taken from one of Alan’s portfolios will be analyzed.

BONUS: Barry will share a real-life credit spread trade using our BCI Conservative Credit Spread Management System.

Discount coupons and a live Q&A session will follow the presentation.

Click here for more information and to register (scroll down).

2. Mad Hedge Investor Summit

June 3, 2026

12 PM ET – 1 PM ET

Covered Call Writing

Uncovering a 3^rd Income Stream in Our Investment Portfolios

Increasing profits and avoiding tax issues using stock options

You have owned shares of stock in your non-sheltered accounts for many years. Share value has been appreciated significantly over time. This has put a smile on your face. Many of these securities have also generated dividend income. This, too, has pleased you. However, there is a 3^rd income stream that you can activate right now, leveraging these same stocks, using a strategy known as covered call writing.

This is a low-risk option selling strategy analogous to generating rental income with a real estate investment property. Yes, renting out your stocks for limited periods. We have 2 goals: generate a 3^rd income stream + retain the underlying shares to avoid negative capital gains issues.

This presentation will analyze how to implement this form of covered call writing, known as Portfolio Overwriting, always with capital preservation in mind.

Details & registration link.

3. American Association of Individual Investors: NYC Chapter

June 10, 2026, at 6 PM – 8 PM ET

More information to come.

4. MoneyShow Masters Symposium Las Vegas

July 20 – 22, 2026

Caesars Palace Hotel

Las Vegas

Details to follow.

5. Toronto Money Show

September 24 – 25, 2026

MaRS Center, Toronto Canada

6. Orlando Money Show

October 5 – 7, 2026

Hilton Orlando Lake Buena Vista

Details to follow.

The PCP (Put-Call-Put) or Wheel Strategy is a multi-tiered option-selling strategy that combines selling cash-secured puts and covered call writing. In the BCI methodology, we (almost) always use out-of-the-money (OTM) put strikes, agreeing to buy shares at a lower price than current market value. If and when those shares are “put” to us, what is the moneyness of the call strikes (in-the-money, at-the-money or OTM) that should be used in the next leg of PCP? In this article, a real-life example with Intel Corp. (Nasdaq: INTC) will be analyzed to demonstrate the available, reasonable choices.

Graphic representation of the PCP or Wheel Strategy

• Start by selling an OTM cash-secured put
• If exercise does not occur, continue selling OTM puts
• If exercise does occur, shares are purchased at a discounted price
• OTM calls can be sold for a traditional (aggressive) approach
• ITM calls can be sold to be more defensive

PCP or Wheel Strategy with INTC with Weekly & Monthly Options

• 12/8/2025: INTC trading at $41.94
• 12/8/2025: STO 4 x $40.00 12/12/2025 put at $1.19 (weekly)
• 12/12/2025: INTC closed at $39.51, and 400 shares put to us at $40.00 ($38.81 BE)
• 12/15/2025: INTC opens at $38.32
• 12/15/2025: STO 2 x 1/16/2026 $38.00 ITM calls at $3.05 (defensive trade)
• 12/15/2025: STO 2 x1/16/2026 $42.00 calls at $0.80 (more aggressive trade)

Put Calculations Trade Entries with the BCI Trade Management Calculator: Closed the week at $39.51 (from $41.94)

The 5-day unrealized return (shares not sold) at contract expiration is $280.00 or 1.80% (yellow cells on bottom right)

Covered call monthly initial traditional & defensive trades

• The ITM $38.00 call has an initial 33-day return of 5.89%, 65.20% annualized (brown cells), with 2.09% protection to breakeven (BE)- purple cell
• The OTM $42.00 call has an initial 33-day return of 2.06%, 22.80% annualized (pink cells), with 8.22% upside potential- blue cell

Current PCP or Wheel trade status

Discussion

In our BCI methodology, when using the PCP or Wheel Strategy, OTM cash-secured puts initiate our trades. If exercised, ITM calls are used to craft defensive trades and OTM calls are implemented when seeking traditional or more aggressive trades.

Covered Call Writing Video Course Package 

Covered Call Writing Package – 4 Part Streaming Video Series + 137-Page Downloadable Companion Workbook

Our objective was to create the most complete and comprehensive video program on covered call writing found anywhere. The 4-set video curriculum takes us through the 3-required skills: stock selection, option selection, and position management. The 4^th section highlights special circumstances like writing calls against long-term buy-and-hold portfolios.

Learn more here.

Free training resources

Click here.

Your generous testimonials

Over the years, the BCI community has been incredibly gracious by sending our BCI team email testimonials sharing stories as to what our educational content has meant to their families. Moving forward, we have decided to publish several of these testimonials in our blog articles. We will never use a last name unless given permission:

1. BCI Educational Webinar #10: The Put-Call-Put (PCP) or “Wheel Strategy”

Thursday May 14, 2026, at 8 PM ET

Using both covered call writing & cash-secured puts in a multi-tiered option selling strategy. A 68-day real-life example taken from one of Alan’s portfolios will be analyzed.

BONUS: Barry will share a real-life credit spread trade using our BCI Conservative Credit Spread Management System.

Discount coupons and a live Q&A session will follow the presentation.

Click here for more information and to register (scroll down).

2. Mad Hedge Investor Summit

June 3, 2026

12 PM ET – 1 PM ET

Details & registration link to follow.to follow.

3. American Association of Individual Investors: NYC Chapter

June 10, 2026, at 6 PM – 8 PM ET

More information to come.

4. MoneyShow Masters Symposium Las Vegas

July 20 – 22, 2026

Caesars Palace Hotel

Las Vegas

Details to follow.

5. Toronto Money Show

September 24 – 25, 2026

MaRS Center, Toronto Canada

6. Orlando Money Show

October 5 – 7, 2026

Hilton Orlando Lake Buena Vista

Details to follow.

After entering a covered call trade and share price rises significantly, leaving the original call strike DEEP in-the-money, what exit strategies opportunities should we consider?

This podcast will cover rolling-up, rolling-out, rolling-out-and-up, closing both legs of the trade and taking no action. A real-life example with NVDA will be used to highlight the information presented.

Free Resources:
https://thebluecollarinvestor.com/minimembership/bci-free-resources/

Premium Membership:
⁠https://thebluecollarinvestor.com/minimembership/premium-membership/

Best Discounted Packages:

1. BCI Package, our Best and most Comprehensive Investment package:
⁠https://thebluecollarinvestor.com/minimembership/bci-investor-program/

2. TCM Package – BCI Trade Management System:
⁠https://thebluecollarinvestor.com/minimembership/bci-trade-management-system/

3. CEO Package – Includes TMC Package:
⁠https://thebluecollarinvestor.com/minimembership/ceo-package/

4. Credit Spread Management System
https://www.thebluecollarinvestor.com/the-bci-credit-spread-management-system/

]]> https://www.thebluecollarinvestor.com/bci-podcast-170-analyzing-the-cost-to-close-a-covered-call-trade-mid-contract/feed/ 0 https://www.thebluecollarinvestor.com/how-to-setup-a-technology-collar-trade/ https://www.thebluecollarinvestor.com/how-to-setup-a-technology-collar-trade/#comments Sat, 18 Apr 2026 10:01:09 +0000 https://www.thebluecollarinvestor.com/?p=213467

The collar strategy is a covered call writing-like strategy where a protective put is added to the covered call trade. Typically, an OTM call represents a ceiling to the trade (maximum gain) and an OTM put represents a floor (maximum loss). In this article, Invesco QQQ Trust (Nasdaq: QQQ), a technology exchange-traded fund (ETF) will be analyzed to explain how the collar strategy can be implemented.

Graphic representation of a collar trade

What is QQQ?

This is an ETF consisting of the top 100 non-financial corporations listed on the Nasdaq exchange. It includes companies like NVDA, AAPL, MSFT and AMZN.

Option chain data for QQQ on 12/8/2025

• QQQ trading at $623.90
• The $626.00 1/9/2026 call strike showed a bid price of $13.27 (ceiling)
• The $618.00 1/9/2026 put strike showed an ask price of $10.75 (floor)
• The goal is to have a net option credit, which is the case using these 2 strikes

Covered call calculations without the protective put using the BCI Trade Management Calculator (TMC)

• Red circle: 33-day trade through expiration
• Brown cells: Initial return: 2.13%, 23.53% annualized
• Purple cell: 0.34% additional upside potential (if QQQ moves up to, or beyond the $626.00 strike)

Covered call calculations with the protective put using net option credit ($13.27 – $10.75 = $2.52

• Red circle: 33-day trade through expiration
• Brown cells: Initial return: 0.40%, 4.47% annualized (without upside potential)
• Purple cell: 0.34% additional upside potential
• The annualized return with upside potential is 8.2%

Discussion

Technology collar trades can be implemented by using QQQ and net option credits. The advantage is that we are eliminating catastrophic losses by including the protective puts. The disadvantage is that we are generating lower initial time-value returns, but with the same upside potential. To generate a higher collar return, a lower OTM call or OTM put strike will accomplish that goal.

Selling Cash-Secured Puts Basic and Advanced Principles

 video course with downloadable workbook

This course contains 6- parts:

Section I: Option basics (definitions and foundational information)
Section II: Traditional put-selling (stock & option selection + position management)
Section III: PCP (wheel) strategy (adding covered calls to selling cash-secured puts)
Section IV: Buy a stock at a discount instead of a limit order (buy a stock at our target price or get paid not to buy the stock)
Section V: Ultra-low-risk put/Delta strategy (High probability, low-risk trades)
Section VI: Ultra-low-risk put/implied volatility strategy (High probability, low-risk trades)

Click here for more.

Free training resources

Click here.

Your generous testimonials

Over the years, the BCI community has been incredibly gracious by sending our BCI team email testimonials sharing stories as to what our educational content has meant to their families. Moving forward, we have decided to publish several of these testimonials in our blog articles. We will never use a last name unless given permission:

1. Sarasota Investment Group

Portfolio Overwriting: A Form of Covered Call Writing

Wednesday April 22, 2026

Details to follow.

2. BCI Educational Webinar #10: The Put-Call-Put (PCP) or “Wheel Strategy”

Thursday May 14, 2026, at 8 PM ET

Using both covered call writing & cash-secured puts in a multi-tiered option selling strategy. A 68-day real-life example taken from one of Alan’s portfolios will be analyzed.

BONUS: Barry will share a real-life credit spread trade using our BCI Conservative Credit Spread Management System.

Discount coupons and a live Q&A session will follow the presentation.

Click here for more information and to register (scroll down).

3. American Association of Individual Investors: NYC Chapter

June 10, 2026, at 6 PM – 8 PM ET

More information to come.

4. MoneyShow Masters Symposium Las Vegas

July 20 – 22, 2026

Caesars Palace Hotel

Las Vegas

Details to follow.

5. Toronto Money Show

September 24 – 25, 2026

MaRS Center, Toronto Canada

6. Orlando Money Show

October 5 – 7, 2026

Hilton Orlando Lake Buena Vista

Details to follow.

Hi Alan,

I bought NEM at $98.68 and sold the $100 call and now it is trading at $113.70. I can’t make any more money. I’m not sure if I should close the trade or let the shares be sold. I don’t care about losing the stock. Any guidance is appreciated.

Thanks,

Barry

Free Resources:
https://thebluecollarinvestor.com/minimembership/bci-free-resources/

Premium Membership:
⁠https://thebluecollarinvestor.com/minimembership/premium-membership/

Best Discounted Packages:

1. BCI Package, our Best and most Comprehensive Investment package:
⁠https://thebluecollarinvestor.com/minimembership/bci-investor-program/

2. TCM Package – BCI Trade Management System:
⁠https://thebluecollarinvestor.com/minimembership/bci-trade-management-system/

3. CEO Package – Includes TMC Package:
⁠https://thebluecollarinvestor.com/minimembership/ceo-package/

4. Credit Spread Management System
https://www.thebluecollarinvestor.com/the-bci-credit-spread-management-system/

More Videos:

• For those new to Alan’s system of Covered Call Writing, be sure to take the Free Beginners Corner Series
• Free Training Videos Archive
• Ask Alan Video Q & A Archive
• Subscribe to our YouTube Channel

To enter your questions to “Ask Alan”, fill out the form on the contact page. Be sure to begin your message with “ASK ALAN”