We are convinced that the best chance you have to beat the market averages is by. A strategy of using is one effective and simple way of doing that. It’s a bullish strategy but one in which if we consistently the call forward we continually reduce our cost basis. What is the best way though to roll those calls?
Our study was conducted in the SPY using data from 2005 to the present. We sold Covered Calls with a 30and compared rolling at or rolling when the Calls dropped below 0.25 (if possible or we rolled at expiration). This study on rolling calls is the first of two that are planned. A later study will examine rolling at .
A table of the results comparing the two strategies was displayed. The table included the cumulative stock P/L, cumulative call P/L, cost basis reduction, cost basis reduction (30% margin) , number of rolls, percentage of profitable calls. The table showed a dramatic increase in cumulative Call P/L and cost basis reduction percentage. Rolling whenwas low, yielded the best returns.
For more information on Rolling see:
Market Measures from July 10, 2015:
Options Jive from January 11, 2016:
Market Measures from February 18, 2016:
Options Jive from May 18, 2016:
Watch this segment of Options Jive withand for the important takeaways and a better understanding of when is the best time to roll a Covered Call.