Скачать или смотреть Viability of a Diagonal (Calendar) Call Spread vs. Covered Calls

A look at the 'Poor Man's Covered Call':
Risks (known and maybe unknown)
Important Criteria for Proper Structure
Concerns of Comparing to a Covered Call

Josh wanted to know: "In my current strategy in Covered Calls I'm enjoying your algorithm that seems to find mispriced, sweet spots.
Can you please address the viability of using LEAPs to lessen the costs of Covered Calls...and how your service can find trades?"

Excellent. First we address the terminology, why we call this a Diagonal Call Spread / Calendar Spread and not 'Poor Man's Covered Call', and illustrate that reason comparing the Profit and Loss charts of this approach and Covered Calls looking at the potential outcomes and why they are different (0:00 to 7:00)

Next we take a look at how the improper structure in the Calendar Spread can result in 2 ways to lose, and how the PowerOptions default Search helps investors avoid this situation and other important criteria such as IV ratio, Delta ratio and more (7:00 to 16:00)

Now we break down the importance of the Profit and Loss Chart of a Diagonal Calendar Spread: How the max. profit is based on closing the spread not exercise - assignment, how it differs from the 'known' max. return of a Covered Call trade and why the max. Profit of a Diagonal Spread trails lower after the sold option strike at expiration (16:05 to 22:45)

Lastly a little discussion on why we did not see the preferred IV Ratio in the Search Results that we adjusted (22:50 to End)