When you write covered calls, greater profits will be earned by writing several two-month positions per year, than from writing one covered call with the longest time to expiration. Time decay for further-out options is quite small, so writing options more than a few months away is equal to lost time. Based solely on option premium profits, focusing on short-term ATM or OTM contracts produces impressive annualized returns.
An example of the covered call and how to identify profit, loss and breake
