Product Description
Exit Strategies for Covered Call Writing reveals the best and most effective procedures to manage your stock option positions. After selling a call option, many investors simply permit the result to run its own course through expiration Friday. This will cost you money! By administering well-thought-out exit strategies, based on sound fundamental and technical principles along with your common sense, your profits will be maximized and your losses will be diminished.
Alan Ellman, author of the best-selling Cashing In on Covered Calls, speaks to the average blue collar investors of the world. In a practical and straightforward manner, he offers sound, honest, and easy-to-understand management techniques that will take the mystery out of covered call writing. Inside you will discover and learn about:
- What exit strategies can do for you
- The key parameters to consider
- Exit strategy alternatives
- Executing exit strategy trades
- Real-life examples
- Profiting with the Ellman calculator
- And much more
About the Author
Dr. Alan Ellman, author of best-selling Cashing In on Covered Calls, wears many hats during the course of a typical day. He is a licensed general dentist in the State of New York and the owner of a vitamin store called The Natural Vitamin and Herb Source of Long Island. In addition to these titles, Alan is also a licensed certified personal fitness trainer and a licensed real estate salesperson.
Alan is also an avid real estate investor, owning properties in Texas, Florida, Pennsylvania and New York. He has often been invited to speak in front of large groups of investors about his successful investment properties.
Of all the facets of his life, Alan has become most passionate about the stock market and call options in particular. He loves the challenge of beating the market and sharing his ideas and system with others. This has manifested itself in the form of seminars and one-on-one coaching classes. In particular, he wants to spread the word about selling call options to the blue collar investor. Alan is determined to assist the average investor in getting the returns normally reserved for the Wall Street insiders.
Exit Strategies for Covered Call Writing: Making the most money when selling stock options
6 Apr
8:53 am on April 6th, 2010
I am a covered call seller, and I do appreciate any books on the subject, because, relatively speaking, there are not many. I’ve also read Ellman’s blog, and he has some interesting and smart things to say about covered calls.
All that being said, however, I’m not sure what to say about this book. If you’re a covered call seller with any experience, chances are you know all of the concepts in this book already. We deal with these concepts every day. I learned nothing new.
But even if you’re a beginner, some of the material is simply too rudimentary for inclusion in a book of this type. For example, do we really need a chapter devoted to placing an online trade (Chapter Nine): “1. Go to your online brokerage account. 2. Hit the place trade link.” And it goes on from there. I mean, seriously. If you can’t find the “place trade” link, should you really be messing around with options?
Also, about half of the book is taken up by charts that don’t really need to be there; they look like filler to me (in all fairness, this isn’t the first options book to do that). My other pet peeve is Ellman’s overuse of “simple analogies” to explain simple arithmetic, such as the references to “if your neighbor’s height is 84 inches, and then he’s 87 inches,” and the like, and the overuse of the “hitting a triple” metaphor. The folksy element could have been dialed down a bit.
Possibly the only use for this book is for beginners to read about the real-life examples of what can happen to covered positions and what can be done with them. Perhaps that’s enough. Therefore, probably worth the price and the time. But as I said, not bad, but not great either.
Rating: 3 / 5
10:02 am on April 6th, 2010
North Pole seems to believe that Alan Ellman’s covered call books are supposed to be magnificent technical tomes regarding option pricing, timing and selection. That is not what they are intended to be. If you want a detailed discussion of Black-Scholes analysis there are many other books out there. If you don’t know what Black-Scholes is, then this book may be just what you are looking for.
There is a reason why the cover says “Blue Collar Investor”, instead of “White Collar Investor”. These books are for the basic stock investor. They leave out a lot of technical jargon which average investors just ignore anyway. I am a certified public accountant. I have been trading options for more than 30 years. I have found Alan’s method of picking stocks to be one of the most helpful investment tools I have ever read. Exit Strategies was written because many of his students, nearing expiration dates, emailed requests to Alan asking, “What should I do now?”. This book attempts to give some guidance to the blue collar investor in this regard.
If you are a Wall Street trader, stock broker or hedge fund manager it probably isn’t for you. Yes it is simplistic. That is it’s purpose. It is intended to bring what passes as a complex trading strategy down to earth for the small investor who doesn’t have $500,000 to invest with some genius who will turn it into $350,000. So, take North Pole’s advice. If you are looking for an insomnia cure explaining the precise reason for an option’s price at 1:38PM on Tuesday, this is NOT it. If you want a helpful, easy to read, and understand, book on covered call writing, then buy Alan Ellman’s books.
Disclosure: I built the Excel option calculator which Alan distributes to his students. It was designed to be simple and easy to use and understand. No, I do not receive anything from the sale, or my endorsement, of his books.
Rating: 5 / 5
12:18 pm on April 6th, 2010
I have been trading stock equities for over 15 years and options have always been some mysterious and unknown aspect of the stock market.
About 10 years ago, I looked at Options trading, but it was a big convoluted world that was very intimidating, and very expensive to obtain knowledge, or to pay for ‘newsletters’, etc
In the last year or so, I stumbled upon some online discussions about Options trading and searched on the internet for more info, and then at Amazon to see what books are out there, as well as to read others recommendations/reviews.
‘Exit Strategies for Covered Call Writting’ showed up. I read the reviews and decided to make the purchase.
All I can say is I wish I had this book 15 years ago as it totally repaints the picture of stock trading & Options for me.
The author breaks the covered call options writing strategies into easily understandable concepts and illustrates each concept with an equally understandable examples to help reinforce your understanding.
This book helped me gain confidence in my understanding of the covered call options market and illustrates how covered call options trading is quite conservative as opposed to the high risk exotic options trading.
Note, this book does not cover exotic options trading, only covered call writing and ‘exit strategies’ on how to handle a variety of issues the might come your way, such as if underlying stock goes up, goes down, goes sideways.
If you are of the mentality of ‘buy & hold’ for stocks and you are not selling covered calls, you are leaving easy money on the table. Hundreds or thousands can be made each month off of the stocks you are already holding.
This book is also great for people that watch individual stocks and feel comfortable about what to expect in how much a stock can go up or down in a short period of time.
Are you down on a current stock investment? Covered call options can reduce your cost basis for the underlying stock so as to help reduce the pain of a stock loss, help break even, or yes, even make a profit on a stock that you are currently underwater with.
You can write covered calls for regular stock broker accounts, or even IRA accounts.
This book is a great investment. I easily recouped the cost for this book and more with my first options cycle that expired in October of this year.
Last point, this book has been a great primer into the entire world of options. While this book only covers covered call writing, it has given me the foundation to understand the ‘exotic’ option world and allows me to see what the risk is as well as the rewards of options trading…so I can tell you the difference between a straddle & a strangle!
Good luck!
Rating: 5 / 5
1:15 pm on April 6th, 2010
Before buying this book, check out the author’s website at thebluecollarinvestor. This is the author’s second book (I have not read the first one). From what I can tell in the first book the author explains: how options work, how to pick stocks to sell call options on, how to use technical analysis for both stocks and the market, and risk management. But this is the second book, basically the author lays out a strategy in 3-4 pages, then gives you 80-90 pages of examples (mostly stock & option charts) with a little bit of comentary at the bottom of each example. If you sell a thirty day option for $1., and can buy it back for .20-.10 in the first few weeks you should do that. I really did not need 120 pages to figure that out.
Rating: 2 / 5
2:57 pm on April 6th, 2010
This book is the perfect compliment to the author’s first book, “Cashing in On Covered Calls.” I am aware of no other book that deals specifically with exit strategies in connection with covered calls, so the book, in topic alone, is truly one of a kind. That being said, like the author’s first book, the concepts and ideas are explained in refreshingly simplistic terms that quickly eliminate any preconceived notions that options trading is “only for professionals.” Having read both of Ellman’s publications, I now only buy optionable securities (writing covered calls on almost all of them) and have more money to show for my decision-these strategies really work!!
Rating: 5 / 5