QuoteOriginally posted by: nazzdackYou guys are starting to "abuse" the strategy. What's wrong with abuse if it adds profit?QuoteOriginally posted by: nazzdack(1) If you're capable enough to anticipate pullbacks in a stock, you should sell the stock and/or short-sell it. Otherwise, you might have to do months and years worth of call-writing to earn back your capital losses. Partially true. Selling a covered call adds profit to a Long equity position under all conditions except if the expiration price closes above the strike by more than an amount equal to the premium minus transaction costs. Thus you need only have an expectation that the equity won't rise too much. Yes, if you really think the equity will drop, then sell or short-sell. But if you think the equity will rise modestly you can add profit with a covered call.QuoteOriginally posted by: nazzdack(2) Higher-dividend paying stocks tend to have lower implied volatilty which again diminishes the premium you can expect to collect. Yes, but the premium you collect is greater than zero. I wouldn't call it free money, but subject to the assumptions about modest price appreciation, the covered call does adds profit.QuoteOriginally posted by: nazzdack(3) It isn't much different than selling naked options. You make money several months out of the year, break-even a few times AND get crushed a few times. Overall, it's a lame strategy.Very untrue. You can only get crushed by a covered-call position to the extent that the underlying drops in price. Any "crushing" is due to the Long equity, not the sold call. Thus, a covered call is no more risky than a regular long position. In fact, covered calls have lower volatility than the corresponding Long-only position -- they actually reduce losses when prices drop. If the price of the underlying drops, the price of the sold call also drops by delta (which means that I can buy the call back at a profit if one wants to unwinds the position).Covered calls aren't lame. They simply add a known amount of profit now in exchange for a foregone opportunity for a certain amount of potential profit later (if the underlying closes sufficiently far above the strike).