The "daily Call" From Option Alpha: Options Trading | Stock Options | Stock Trading | Trading Online

Hey everyone. This is Kirk here again from Option Alpha and welcome back to the daily call. Today, we're going to answer the question, “Do I need a margin account to trade a covered call?” The short answer to this is no, you do not need a margin account to trade a covered call. The beauty of trading covered calls is that they are covered by existing stock positions in your account and that’s why most brokerages will allow you to trade covered calls because you’re selling options, but it's completely covered and therefore, no additional margin is necessary by the underlying stock that's in your account. Now, I would highly suggest, however that if you are serious about trading options and continuing to use options trading as a source of income either now or in retirement that you start to apply for margin accounts or start to open margin accounts that allow you to trade more complex strategies and tickers. In particular, what we found is that trading covered calls while could be profitable for many different m