How I Made $19K in 10 Days with MicroStrategy Covered Calls

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Investing in the stock market might seem daunting at first, but with the right approach, you can unlock opportunities to generate consistent income. In this post, I’ll share how I used a covered call strategy on MicroStrategy stock to achieve a $19,000 gain in just ten days. This method prioritizes premium income, commonly known as "juice," over attempting to predict market movements.

The Covered Call Strategy in Action

A covered call strategy involves holding a stock and selling call options against it. The objective? To collect premiums regardless of whether the stock price moves up or down. Here's how the trade unfolded:

The Initial Setup:
I purchased seven contracts of MicroStrategy stock at a $250 strike price, expiring in June. These were long-term positions selected to generate regular premium income.
Rolling Calls:
Initially, I sold calls at a $20 strike for $37 per contract in premium. As the premium decayed, I bought them back at $3, securing a 90% profit.
Reinvesting in New Calls:
With MicroStrategy stock surging to approximately $396, I sold new calls at a $400 strike, set to expire in nine days. Each contract fetched a premium of $2,775, resulting in $19,425 across seven contracts.

Key Considerations

Risk Management: By collecting premium income consistently, the strategy lowers the investment basis over time, helping mitigate potential losses.
Volatility Opportunities: MicroStrategy's inclusion in the QQQ ETF amplified stock volatility, enabling higher premiums. Despite this, managing downside risks remains crucial.
Long-Term Plan: Weekly premium collection aims to recover the initial investment within 10-12 weeks, with subsequent income becoming pure profit.

Life-Improving Tips

Understand Your Strategy: Master the mechanics, risks, and outcomes of your trades before diving in.
Stay Disciplined: Develop a solid trading plan and stick to it, even during unpredictable market shifts.
Manage Your Mindset: Emotional stability is vital. Approach market fluctuations with a clear head and avoid panic decisions.
Leverage Communities: Join mastermind groups or online trading communities to learn, share experiences, and stay motivated.

FAQs

Q: What is a covered call strategy?
A: It involves owning stock and selling call options against it to collect premium income.

Q: What happens if the stock moves above the strike price?
A: If the stock exceeds the strike price, the upside is capped, but you still retain the premium.

Q: Is this strategy risky?
A: Selling covered calls is generally less risky than outright stock ownership, but it doesn’t eliminate risk. A sharp stock drop can lead to losses.

Call to Action

Want to learn how to generate consistent income using strategies like covered calls? Explore educational resources, join trading communities, or follow experts in the field. A great starting point is Mark Yegge’s Cash Flow Machine system, which provides structured guidance for beginners and advanced traders alike.

Get started today

Conclusion

The covered call strategy offers a reliable way to earn income in the stock market. By focusing on premium collection and disciplined execution, traders can achieve impressive returns, as shown in this $19,000 MicroStrategy example. However, success requires understanding risks, maintaining a calm mindset, and committing to continuous learning.

Start with small steps, stay consistent, and watch your trading potential grow. Here’s to your success!

How I Made $19K in 10 Days with MicroStrategy Covered Calls

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