covered call delta | BTCC Learning Hub

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What is a good Delta for a covered call?

If the goal of the covered call is to capture the entire extrinsic value by seeing the option expire worthless, some investors may focus on calls with deltas between .30 and .40 because there's a 60% to 70% theoretical probability they'll expire OTM.

What is the delta of a call option?

An at-the-money (ATM) call option typically has delta of around .50. Out-of-the-money (OTM) call options have delta less than .50, and in-the-money (ITM) call options have delta greater than .50. The underlying stock has a delta of 1; puts have negative deltas.

What is the delta of a $50 call?

In the scenario where we sold a $50 call and the stock was trading at $70 with one week remaining, the delta would be at or near 1 and for every $1 change in the price of the stock; the option will also change by approximately $1. This is typical of deep I-T-M strikes. For at-the-money strikes, deltas will be closer to .5 or 50%.

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What is a good Delta for a covered call?

What is the delta of a call option?

What is the delta of a $50 call?

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