covered option

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  • noun

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a put or call option backed by the shares underlying the option

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Covered options are sold against the portfolio to generate cash flow.
Today, The Sidewinder Report covered options trading in the following securities:
SAN FRANCISCO -- MCF Asset Management, LLC, a wholly owned subsidiary of MCF Corporation (NASDAQ:MERR), today announced that it has hired Matt Kelmon to serve as managing director and to launch a new covered options investment strategy.
This strategy combines the purchase of high quality stocks with the concurrent sale of Covered Options against these stocks to generate an option premium income.
Both covered option writing and equity ownership involve risk and are not suitable for all investors.