Customer Reviews

Cashing in on Covered Calls. Investing with Stock Options

5 star:		(21)
4 star:		(3)
3 star:		(0)
2 star:		(1)
1 star:		(3)

 

 

I have been trading options for over thirty years. I have often made money on the option but lost more on the stock. I own Alan's book because he has developed a structured method of selecting the best stocks for covered call writing. If you follow his rules for selecting the stocks, selling the covered call and, if necessary, cutting your losers, you should be very successful.

Best Book on covered call options that I've read
This system was a real eye opener -Takes you step by step through the entire process from picking the correct stocks to exit strategies-While most option books only give you a cursory glimpse into covered calls, Ellman's book goes through the entire process-A must read for beginners and veterans alike

The book contains key concepts for creating a potentially profitable trading system, but doesn't go into enough detail in certain areas, especially regarding what to do when a stock goes down. I wanted more strategies dealing with managing losses, but I think the author saved that for his extensive line of CDs and DVDs. But you can figure out strategies of your own if you research, ponder, and trade long enough.

My final word is for you the reader to enter the market slowly and get used to the rules of placing trades, to get a feel for how the market moves and how much, and to experience the feeling of having your money on the line (much different than when it's paper). Eventually you can move into bigger positions and discover how much "stress" you can personally endure. It took me many nights of half-sleep before finding a level of risk/reward I was comfortable with.

This is a good book for beginners to familiarize themselves with covered call writing. A weakness I noticed with most introductory books on this subject, this one included, is that they seem to accentuate the positives but overlook the negatives of using covered calls. If you write covered calls against a stock and collect a premium but the stock keeps moving lower and suddenly you are facing a 25% or more loss in the stock; the small premium you collect is of little value. This is especially a problem with sudden bad news or down gaps. My point is that holding the option until expiration may not be the right strategy in many cases. In addition using technical analysis to time entry and exit is critical to maximize option premiums as well as paying special attention to implied volatility of the underlying security . Many other factors including open interest ,short interest on the stock etc .give clues to option behavior. It is thus necessary to continue your education by reading other books that focus on volatility, timing , as well as technical analysis.

Cashing In On Covered Calls educates the reader, in a manner that is truly simple and straightforward, to do precisely what the title implies. Although I have been investing in the market for approximately 15 years, and am currently employed on Wall Street, I must admit that this book has opened my eyes to what I believe is one of the most underutilized trading strategies to date. Many of the so-called "experts" on Wall Street view covered-call writing as too conservative a strategy to profit significantly. Ellman's method, however, if implemented properly, proves just the opposite, and I say that based on personal experience, having made significant gains (up 32%) since utilizing his strategy. The author astutely exploits the power of profit compounding by immediately reinvesting option premiums in stocks that are fundamentally and technically sound, and it is Ellman's stock selection method, which is as intelligent as it is simple, that is perhaps my favorite part of his book. I would highly recommend this book to anyone, be it novice or veteran trader, who values minimizing risk while making periodic streams of profit.

Cashing in on Covered Calls. Investing with Stock Options

Janet and I are retired and wanted an avocation to supplement our Social Security and pay for our meds. Allen's Book gave us the knowledge and the support we needed to get started. In my first three weeks, I earned over $7800 using his methodology. Not a bad income generator, huh? I advise senior citizens nearing or at retirement age to investigate their potential for selling covered calls and investing with stock options.

It is all about money management. Janet and I have a Get Rich Pile ($3500) which we use for buying and selling options. We also have a Stay Rich pile which is our 401k rollovers...we don't let the broker run it any more. We manage them. Allen's book, blogs, forms and secrets for success are in this book. It is the closest thing we have found to a silver bullet. Be careful out there...these are hard times.

ALAN, I want to thank you for your book on Covered Calls. I subscribed to a course that cost several thousand dollars to learn all the different ways to use options (Bull Call, Bear Put, Straddles and Iron Condors etc) but they never told much about covered calls. I bought your book for $19.95 and a Subscription to Investors Business Daily. I have recouped my investment in the course and have settled on using covered calls exclusively to do options. My thanks to you for showing me the way. It involves much less risk and your method is a way that I can do options without losing sleep. It does require some monitoring, but that only takes a few minutes a day. Thanks Again

I rarely write reviews but this book was so terrible it needed to be done. If you have any experience at all do NOT waste your money. If you don't have any experience at all, do NOT waste your money. When someone talks about all the winning trades they make and how they make 3% a month with no draw downs stay away. This book is dangerous if you are a newbie and think you can make the returns this guy says he does consistently every month. Buy Investors business daily, find optionable stocks and play the ones with the best ratings. I summed up the book for you so save your money.

This book has all you need to learn to pick stocks and sell options successfully. Alan Elman has a proven system that works for him and he's done an excellent job putting it onto paper.

It's not a simple system and requires time and effort. It's all in this book. I was fortunate enough to attend some of his seminars and the book has everything he covered there. It's a well written and well organized book that will teach you his method of investing.

Very very basic book.
I bought it several months ago to understand better what the "covered call" strategy is, in my search for the holy grail.
You won't find complex strategies in this book, nor volatility discussions, nor greeks and all this stuff ... the author does not even mention how to maximize the premium of a call by just writing it near resistance.
In fact, this book is just about "selling time" ... basic "buy write", each month.
Although the experienced trader may find it too boring a strategy (and find the book too easy), it can nonetheless generate, if you know how to defend your trades well (I'm not talking about setting stops, but rather adjusting your trade in selling calls or buying puts - not discussed by the author) between 2% and 4% each month, meaning between 24% and 48% annualized ... and this is certainly a good thing !
I also like this strategy because the premium you sell acts like an insurance against your stock.

In short : if you are a beginner trader or investor, you can buy this book and read about a simple strategy that works. I would say it is maybe one the easiest way to earn money consistently ... but you'd better read also the author's second book to have a plan when things don't go as expected
If you already know what a covered call is, you will learn nothing new in this one, but maybe you could just implement this strategy, enjoy the results and relax !

Special mention to the author : I had the chance to write several e-mails to the author concerning certain points, who always responded kindly and quickly, which is rather rare nowadays.