Covered Call Income

Covered Call Income

The Covered Call Income SMA strategy seeks income and growth of capital from the sale of covered call options on high-quality U.S. large capitalization equities. Stocks are purchased while call options are written/sold out-of-the money with the intention of the stocks being called away by expiration.

 The sale of covered calls increases the portfolio’s income but limits the profit potential to the strike price written on the calls at the beginning of the process.

Portfolio Managers

Wally Taggart
Dave Gilreath, CFP®

Inception Date

09/01/2010
Request a Fact Sheet

Covered Call Income SMA Strategy Highlights

Seeks cash flow through option premiums, short-term capital gains, and dividends.

Short-term focus can pair well with traditional long-term strategies.

Active management of this SMA focused on mitigating downside risk of individual companies.

Covered Call Income Portfolio Construction

1st | Macro Outlook

Review sector weighting trends based on the S&P 500 and macro-economic research.

2nd | Universe

Identify best candidates of U.S. listed companies finding candidates based on price and market capitalization.

3rd | Screen

Utilize Revelation Investment Research to analyze downside risk based on valuation, growth, fundamentals, and sentiment.

4th | Decision

Select 25-30 U.S. companies for this SMA with sufficient option liquidity, attractive option premiums, and near-term growth outlook. Positions are regularly reviewed.