Selling CALL options is a popular strategy for generating extra income, especially if you already own the stock. Known as a covered CALL, this approach lets you collect a premium upfront by agreeing to sell your shares at a set price (the strike price) if the option is exercised.
It’s a great way to earn passive income while holding a stock, particularly in sideways or slow-moving markets. If the stock stays below the strike, the option expires worthless and you keep both the shares and the premium. If it rises above the strike, you still profit — but you sell the stock at the agreed price.
This strategy works best with stocks you’re willing to sell and can be a smart way to boost returns from long-term holdings.