My Covered Call Option Strategy

I would  like to share my thoughts and how I have been maximizing my profits with covered calls. 

Needless to say, we closely monitor our covered calls—especially as they approach expiration. 

There are mainly three possible scenarios that tend to happen:

1) Share price rockets and is significantly above the strike price

This is like having a pair of Aces in blackjack—you are deciding whether to hit or split. In this case, I definitely choose to roll over the call to a much later expiration date with a higher strike price. Sometimes, I go as far as two years out. Alibaba (BABA) is one such stock in my portfolio with call options expiring in 2026 and 2027. A happy problem![Miser]  

2) Share price is above the strike price

I decide whether the strike price is the price I'm willing to sell the stock at. Ironically, there are times when we're “forced” to sell covered calls at a lower strike price just to collect a decent premium. In that case, I roll over to a later expiration date with a higher strike price—usually within 30 days for me.

Alternatively, if the strike price is the price I want to sell at, I will just let the option be exercised and allow the stock to be called away.

3) Share price is well below the strike price

In this case, I definitely roll over to the same expiration date but with a lower strike price, just to earn some pocket money. The extra premiums may not seem like much, but they add up. Here are a few recent trades to illustrate:

Examples:

GOOGL 2025-05-16 $175: closed call at $0.08

GOOGL 2025-05-16 $165: sold call at $0.24

AMD 2025-05-09 $110: closed call at $0.02

AMD 2025-05-09 $104: sold call at $0.18

NVDA 2025-05-09 $130: closed call at $0.02

NVDA 2025-05-09 $118: sold call at $0.41

On expiration day, I usually wake up early to monitor and roll over options if needed. I am trying to squeeze out every penny I can on the journey to financial independence.

If there is a better way of doing this, I'd love to hear your thoughts. Many thanks in advance![Happy]