• Stein Whittington Deniel utilizes a conservative option investing strategy known as Covered Call Writing or the Buy/Write strategy.

• This strategy is widely recognized as a conservative approach to holding stocks because it reduces the risk as compared to the usual buy and hold portfolio.

• The strategy also generates monthly income from the receipt of covered call option premiums even when stock markets do not perform well. This income can be withdrawn or left in the account for reinvestment and growth.

• When covered call writing is carried out in an IRA, Defined Benefit or other tax advantaged retirement account, the premiums constitute additional contributions not limited by the annual contribution maximums.

• Some frequently asked questions about this strategy are listed below.

• Should you wish to know more about this subject and whether it would be suitable for your investment goals, please email us at: info@steinwhittingtondeniel.com

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Frequently Asked Questions:

Q: What is a Covered Call?
A: A covered call is an investment strategy in which an investor writes (sells) a call option contract while at the same time owning an equivalent number of shares of the underlying stock. The investor assumes the obligation to sell his or her stock at a fixed price for a specified period of time in the future. In exchange for assuming this commitment to sell the stock, the investor receives a premium (income) that is deposited into the investor's account.

Q: How can the Covered Call Strategy help me preserve and grow my investment portfolio?
A: By owning stock positions and writing covered call contracts on these stocks in a disciplined manner, we are able to deposit the contract premiums into your account on a regular basis thus increasing the value of your portfolio. These funds provide limited protection against a decline in market prices. They also constitute a steady stream of income that can be used to purchase additional shares or can be withdrawn.

Q: Is the selling of Covered Call options risky?
A: The Covered Call Writing strategy is considered to be a conservative choice among the four basic option-investing techniques. In fact, it is one of only two option-investing methods allowable in individual retirement accounts due to its status as a wealth preservation strategy. Furthermore, covered call writing is more conservative than simply owning stocks under a buy-and-hold strategy.

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Q: Who should use Covered Calls?
A: An investor who is neutral to moderately bullish on the direction of the stock market and is willing to limit his/her upside potential in exchange for the downside protection and income generating ability of the investment strategy.

Q: Where can I learn more about this investment technique?
To learn more about it click on one of the links listed below:

Link 1: The website for The Options Industry Council. Take advantage of their Options Knowledge.

Link 2: The home of Compound Stock Earnings.com. Check out their thoughts on The Art and Science of Covered Calls.

Link 3: What makes a good Covered Call? Learn this and lots more from Covered Calls.com

Link 4: The Option Yield Report explains the latest on Covered Calls, buying Covered Call options and Covered Call writing.

Link 5: Review Option Strategies from Yahoo Finance.com

Link 6: Who should consider using Covered Calls? You will learn how to use Covered Calls and lots more from the Chicago Board of Options Exchange. (This link is a PDF file so you'll need Acrobat Reader installed to access it. Need Acrobat Reader? It's a free download. Good luck and go to: http://www.adobe.com/products/acrobat/readstep2.html).

Link 7: Calls and Puts.com is a comprehensive Options Data Site. You'll find introductory information about Covered Calls plus profit potential.

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Stein Whittington Deniel Investment Advisors | 73-255 El Paseo Drive, Suite 14 | Palm Desert | California | 92260 | Phone: 760.776-1488 | Fax: 760.776-5778 | email: info@steinwhittingtondeniel.com