Covered calls. Are the services worth it?
There are many companies that offer first free seminars, then  charge (2-3K) for seminars to teach proprietary software for
covered calls and tricks in down markets.

My questions is IS IT WORTH IT? After monthly fees, trading fees/ commissions etc. what is left? Is it that difficult to do Covered calls?

Do these companies thrive for a large part on such fees/ seminar fees as a key source of their income?

It is hard to tell good companies from bad ones..

Can you help?


Hello N,

My opinion is that it is not worth it.  And I have a few reasons.
  • Most people can learn how to use covered call writing by reading some good books on the subject (The one I wrote is called: The Short Book on Options).
  • Too often the people who charge those fees are more interested in trying to convince you to take more costly seminars than they are in making sure that their clients learn the material they paid to learn.  Yes, they make their money by collecting these fees.
  • And, as you said, it is difficult to tell the good companies from the bad.
But, the strategy is definitely worth learning.  It is not the best option strategy. It's not the only one you will want to use for the rest of your investing life.  But it is an excellent strategy for the bullish investor.  And it's the ideal strategy to really learn about options and understand how they work.  Once you feel quite confident that you do understand, there are more basic strategies to learn.  But I think you have made a good choice by beginning with covered call writing.

As to trading expenses (commissions), in today's world there are some very inexpensive brokers.  And that's especially true if you trade online.  And these are good brokers.  So get some recommendations from people you trust and choose a deep discount broker.

You are right - it's not that difficult to write covered calls.  There is no need to pay anyone monthly fees.  My caution to you is to be just a bit careful.  Try not to choose your stocks just because the calls look expensive and you like the high prices.  It's far better over the long-term to only write covered calls on stocks you really want (or are at least willing) to own.  If and when the market heads lower, you will lose some money, but you will at least have a portfolio of stocks that you are willing to own, and not a bunch of junk.

Write again if you require clarification on any of the above.