Hypothetically, if you had 700 shares of ACN at a cost basis in the 70s and you wanted to sell covered calls with a low probability of having shares called away and if they are a max of 200 shares), what would your strategy be?
I’ve been selling ~2 contracts weekly with strikes ~6-7% above and avoiding high volatility events like earnings and the fed.
Posted by factoredfactorio
1 Comment
There is no way to ensure the shares are not called away, so be sure this is clear. But the odds can be reduced . . .
IMO look at a low delta that would mean a smaller probability of being called away. An example would be a .15 delta would be about a 15% probability of the call being ITM at expiration. See this for how Delta and probabilities work – [Options Delta, Probability, and Other Risk Analytics | Charles Schwab](https://www.schwab.com/learn/story/options-delta-probability-and-other-risk-analytics)
Next, if you open a CC around 30-45 DTE and then close for a 50% profit it will reduce the odds of being assigned even more. Once closed open another one but avoiding ERs and other events is a good idea.