Trade Of The Week: Emerging Markets

Options Portfolio Manager – Investors Alley • Aug 8, 2023 at 12:04 PM EDT

Covered calls can be a strategic path toward increasing cash flow on a position while waiting for it to rally.

Covered calls can be a strategic path toward increasing cash flow on a position while waiting for it to rally. For instance, last week a trader purchased 15,000 covered calls in iShares MSCI Emerging Markets ETF (EEM).

EEM is a popular asset class ETF used to gain exposure to emerging markets. This trade is using out-of-the-money January 2025 calls, which could be a way to generate additional cash on the position while expecting a long-term rally in emerging markets.

(Click on image to enlarge)

To watch the video, click here. (Running length 00:03:39)

More By This Author:

Trade Of The Week: CLF
Trade Of The Week: Bonds
Is Nvidia Headed Even Lower?

Disclaimer:

Information contained in this email and websites maintained by Investors Alley Corp. ("Investors Alley") are provided for educational purposes only and are neither an offer nor a recommendation to buy or sell any security, options on equities, or cryptocurrency. Investors Alley and its affiliates may hold a position in any of the companies mentioned. Investors Alley is neither a registered investment adviser nor a broker-dealer and does not provide customized or personalized recommendations. Any one-on-one coaching or similar products or services offered by or through Investors Alley does not provide or constitute personal advice, does not take into consideration and is not based on the unique or specific needs, objectives or financial circumstances of any person, and is intended for educational purposes only. Past performance is not necessarily indicative of future results. No trading strategy is risk free. Trading and investing involve substantial risk, and you may lose the entire amount of your principal investment or more. You should trade or invest only "risk capital" - money you can afford to lose. Trading and investing is not appropriate for everyone. We urge you to conduct your own research and due diligence and obtain professional advice from your personal financial adviser or investment broker before making any investment decision.