Part 5/8:
When implementing a Poor Man’s Covered Call strategy, it is vital to select options that will appreciate in value—not merely chase the highest premiums. For example, if one were to invest in Apple, an analysis of the stock's implied volatility can provide a clearer picture of potential future performance. Apple’s implied volatility, being below its average, suggests possible gains from the long call option should options pricing become more favorable.
Furthermore, selling calls against the long position does not only serve as premium collection; it acts as a protective measure that offsets potential losses in the long term.