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

Hey everyone. Welcome back to the daily call. On today’s daily call, we want to talk about the two major reasons why you shouldn’t trade covered calls. Now, we talk about covered calls before on this podcast, also on our regular podcast. Covered calls are a great way to transition from stock trading to options trading. In fact, it’s something that I suggest that people do or at least start exploring because it's a very smooth bridge between the two I guess ways of trading, the two systems of trading. But the two major reasons why you shouldn't trade covered calls the more you learn about them even though you might start doing that initially as a good bridge or a good segue into options trading, is that one, stock is still incredibly inefficient and capital intensive. This is the first reason. Stock requires a ton of capital to purchase and to do a covered call, you have to own at least 100 shares for each covered call that you sell. For us, stock is incredibly inefficient and very capital intensive. Especiall