Covered Calls
What It Is
You own 100 shares → you sell a call option against them. You generate income but cap your upside.
Risk Level
🟢 Low
(only risk is opportunity cost)
Capital Required
100 shares of the stock
Becomes practical at $2.5k–$5k+
When to Use
- When stock is neutral or slightly bearish
- When you want stable income
- When you're okay selling your shares
When to Avoid
- Before earnings
- On highly volatile growth stocks
- When you expect a big rally
Return Style
Slow, steady monthly yield.
Progression Fit
Essential for your $5k–$100k wheel system.