The intention of this article was to give you the premise behind the theory of option selling and offer a practical approach to implementation. What you've read is only the beginning when it comes to the practice of premium collection. I hope that I've piqued your interest enough to open your mind to the possibility of accepting limited profit potential and unlimited risk; sometimes the quantity of wins trumps the quality of a win.
Carley Garner is the senior analyst at DeCarley Trading LLC, where she also works as a broker. She is a coauthor of Commodity Options: Trading and Hedging Volatility in the World's Most Lucrative Market, published by FT Press. Visit DeCarley Trading's website for a free subscription to Carley's e-newsletters, The Stock Index Report and The Bond Bulletin, and for details on the services she provides.