I work full-time. Part-time trading is what I do. Time and risk are the two main reasons why the buy-write strategy and covered calls are ideal for me. I’ve been trading since the 1980’s. With my own money, I’m speculating and investing.
I found and fell in love with the buy-write strategy early on. It’s an approach I’m most at ease with. I work full-time, so I don’t have much time to check out the market and my holdings on a daily basis. My risk tolerance is a little low. That’s who I am.
Why Buy Write Strategy
In trading, there is no such thing as a 100 percent guarantee. One can choose the correct stock and make millions, or one might choose the wrong stock and lose a lot. There is always a loser for every winner. The future is uncertain. Everything is unpredictable and full of the unknown. As a result, while a buy-write strategy is not a “sure thing,” it is a rather “safe” investment plan for me. It carries the degree of risk that I am most comfortable with.
Because I write covered calls on a monthly basis, I prefer to concentrate on the long-term trend. As a more conservative trader, I frequently write ITM calls to “secure” my income, because ITM calls offer more downside protection than ATM or OTM calls. On the other hand, ITM calls do not generate as much profit as ATM or OTM calls.
Furthermore, when a strategy fails, it can be repaired. I won’t go into great depth because I follow this strategy on Investopedia about Fix Broken Trades With the Repair Strategy
Renko charts were introduced to me in the 1980s when trading futures, but I hadn’t utilized them in trading until lately. A Renko chart is uncomplicated and straightforward. The support, resistance, and trend lines on the chart are simple for me to draw. They assist me in making great trading decisions.
6/12/2021 – revision
5/12/2021 – added Renko
5/2/2021 – version 1.0 added covered calls