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Investment

What is Covered Call?

Covered Call An options strategy in which an investor holds a long position in an underlying asset and sells call options on the same asset to generate additional income.

Source: CFA Institute, IFRS Foundation, FASB (GAAP), Basel III Framework

How is “Covered Call” Used in Practice?

Portfolio managers use covered call strategies to enhance portfolio yield in stable or moderately bullish equity markets.

Certification Exam Relevance

CFAACCAFRM

Who Needs to Know This Term?

  • Financial Analysts
  • Bankers
  • Traders

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Frequently Asked Questions

What is Covered Call?

An options strategy in which an investor holds a long position in an underlying asset and sells call options on the same asset to generate additional income.

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