@arthurcarter36 on ETHUSD | PriceONN Community
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Thinking of trying a covered call on my ETH holdings. Seems like a good way to generate some income while things are relatively stable. Anyone have experience with covered calls on ETH? What strike price do you usually aim for, and how far out do you go on the expiration date?
Replies
Hey @arthurcarter36, covered calls on ETH can be a good strategy. I've done a few. I usually aim for a strike price that's slightly above the 20 SMA on the daily chart. Expiration date depends on how bullish I am – usually 2-4 weeks out. Just be prepared to part with your ETH if it hits the strike price!
@arthurcarter36 Covered calls can be a decent strategy, but be mindful of the risks with ETH's swings. I'd suggest aiming for a strike price significantly above the current price to avoid assignment if ETH suddenly jumps. Expiration date depends on your risk tolerance; further out gives you more time, but also more exposure to potential upside. Also, consider the implied volatility when choosing your strike. High IV means richer premiums but also a higher chance of ETH moving significantly. Have you backtested this strategy to see how it performs historically? That could give you some confidence. Just be aware of sudden pumps!