One of the most difficult things for an investor is putting in place protection during a downturn, whether it be a full-blown market panic or a stock downturn. Buying protection is tough for most investors because it means a capital outlay and often a stock recovers and the capital spent was unnecessary. Sometimes though a stock downturn ends up being permanent and can wipe out a lot of investors. Take Research In Motion Stock for example. At the heyday of Research In Motion Stock, it was trading at over $140.00 and it seemed like it was going to just keep on climbing. Analysts preached that every investor should have some capital in Research In Motion stock. In fact it was a disaster that engulfed millions of investors and left billions of dollars in losses.
Deep In The Money Covered Calls Rescue Strategy
For investors with the knowledge of how to apply and adjust deep in the money covered calls, this simple but highly effective strategy can rescue a losing trade. It can not only save capital but often turn a declining stock into a winning trade for an investor. This article outlines how to use this deep in the money covered calls strategy properly and includes an 8 step summary which investors can follow to learn and apply this strategy consistently. Sometimes protecting a stock position, particularly a long-term stock portfolio can be easier and more profitable than the majority of investors realize.