Selling Covered Calls for Income

Selling covered calls is one of the most reliable ways to generate consistent income from your stock portfolio. Here's how to do it effectively.

How Much Income Can You Generate?

Typical covered call income ranges from 1-4% per month depending on:

Stock volatility (higher volatility = more premium)

Strike price selection (closer strikes = more premium)

Time to expiration (longer = more premium)

The Income Investor's Approach

Monthly Income Strategy

Select quality stocks you want to own long-term

Sell monthly calls 30-45 days out

Choose strikes 5-10% above current price (delta 0.20-0.30)

Collect premium and repeat each month

Example Portfolio: $100,000

| Stock | Shares | Monthly Premium | Annual Income | AAPL100$400$4,800 NVDA100$650$7,800 MSFT100$350$4,200 AMZN100$500$6,000 | Total | | | $22,800 (22.8%) |

Best Practices for Income

Don't chase premium - Stick to quality stocks

Be consistent - Sell calls every month

Manage early - Close at 50% profit if reached quickly

Roll when needed - Extend trades rather than taking assignment