Why Covered Calls Are Not A True Hedge

02/11/2019 20 min Episodio 48
Why Covered Calls Are Not A True Hedge

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Episode Synopsis

You might have read that covered calls are a good way to hedge. They do have utility for investors, but they are not an optimal hedge. Understand how they only minimally reduce the downside while reducing the upside. Plus, see how low interest rates have undermined call premiums.     What are covered calls? How much do covered calls hedge the downside? How do covered calls cap upside moves? Examples of covered calls and the premium received vs. downside hedge What are options collar strategies? What is the option Greek RHO? How option premiums are affected by interest rates Why record low interest rates make covered calls less appealing     Mentioned  in  this  Episode:     Contact Derek www.razorwealth.com   Derek Moore's book Broken Pie Chart https://www.amazon.com/Broken-Pie-Chart-Investment-Portfolio/dp/1787435547/ref=sr_1_1?keywords=broken+pie+chart&qid=1558722226&s=books&sr=1-1-catcorr

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