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Options Trading: Covered Call Strategy Basics - Charles Schwab

Most investors enter the world of covered calls with a "set it and forget it" mindset. You sell the call, collect the premium, and wait for either a modest gain or a steady income stream. But the real professionals know that the most critical part of the strategy isn't the sale—it's the . buying back covered calls

The Art of the "Un-Trade": Why Buying Back Your Covered Call Is Often Your Smartest Move Options Trading: Covered Call Strategy Basics - Charles

If your stock skyrockets and your call goes deep "In-the-Money" (ITM), you face assignment—meaning your shares are sold. If you’ve held those shares for 11 months, being assigned would trigger a , which can be significantly higher than long-term rates. collect the premium