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buy-write

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Financial Dictionary

Buy-Write

A strategy consisting of buying stocks and writing covered call options on them to generate maximum current income from option premiums and dividends.

Investopedia Commentary

If the call is exercised, the investor may have to sell the stock at below market price. But because they already own the stock, the risk is limited. This is also known as a covered call.

Related Links

Options Basics Tutorial
Come One, Come All - Covered Calls
Using LEAPs As A Surrogate for Owning the Underlying
Going Long On Calls
Naked Call Writing

See also: Call Option, Covered Call, Option

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