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This week at the Options Institute
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Welcome to your source for answers to questions about option concepts, strategies, and terminology. A new question and answer is published each week. To view the Ask the Institute archives, click the "Ask the Institute Archive" link below.

Please note, questions WILL NOT be personally answered and may not be chosen for publication on the web site.

View the archive of all "Ask the Institute" questions.

 

This week's question:

DATE:  May 14, 2012

QUESTION:
Can you explain the difference between the Buy-Write strategy and the Covered Call strategy?

ANSWER:
The Buy-Write strategy is a two-art strategy of simultaneously buying stock and selling calls on a share-for-share basis. Some traders use the term Covered Call to refer to the exact same thing as a Buy-Write. However, other traders also use the term Covered Call to describe a call that is sold on a later date than when the stock was purchased. To learn more about the difference between Buy-Writes and Covered Calls, view this week's segment of "Ask the Institute."

 




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