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How a great idea by a few traders turned into the world's premier covered call website.
Turning CallWriter.com into the premier covered call website has been a labor of love. Many years ago, we realized that three things were necessary for consistent success in covered call writing: Finding the highest returns. A way to manage open trades. A trading methodology designed to yield consistent results. Anything else, frankly, leads to inconsistent results, or to losses. Learn how CallWriter achieved its goals by building the best and most complete covered call tools available, in the process building the premier site for covered calls. It is important for visitors to realize that we at CallWriter trade off the very same tools available to members on the CallWriter website . Yes, we use the same information available to you. If there was better trading information out there, we would be using it. The Bad Old Days It used to be a truly formidable task to find covered calls, a strategy in which you buy stocks with the highest option premiums and sell call options in order to generate income. Before the late 1990s, prices on stock options were printed in the morning paper, and were deadly stale by the time anyone saw them. With the advent of online trading, you could get option chains, but there was nowhere to get lists of the highest-returning covered calls. It took horrendous amounts of time to find even one decent trade! We then figured out a way to reach out and grab market prices, run the covered call calculations and then examine the results. This rather crude program would only look at 150 or so potential trades at a time, and it wasn't real-time at all. We had to run the software to update prices. But it was exciting! It was light years behind our current Profit Engine™ software, but good for its day.

Then we hit technology pay dirt. We figured out how to generate lists of the highest covered call returns that actually updated every few minutes. We were in heaven. But we realized... we just had to share this with other covered call writers.

Mid-1999: the Launch

In the summer of 1999, CallWriter.com first saw the light of day. We officially launched our Real Time Lists™ of the highest covered call returns. Oh, they were primitive compared to modern CallWriter lists, but still better than anything else available at the time - better, in fact, than most covered call sites offer even today.

We created the S&P 100 list, the Nasdaq 100 list and All Markets list (the last has since been broken into four different lists, by price). And we generated lists for both the current month and next month.

Covered call writers loved it. They flocked to the site, enchanted by fresh lists of potential trades that automatically updated every few minutes.

Early 2000: We Go Deep

Naked call traders had been asking for lists of out-of-the-money calls with high returns. So we created and launched our Deep Out of the Money lists of covered call trades that were at least 10% out of the money, for those looking for supercharged returns. These lists also help traders find naked calls and bear call spreads.

At the same time we launched lists of Deep in the Money lists featuring covered call trades at least 10% in the money. In a dropping or ranging market, it is important to see trades that offer larger premium and greater downside protection. Covered calls can actually be written on stocks in a downtrend if the calls are deep in the money. This is easily one of our most popular lists.

2002: We Become Very Calculating

Along the way, we continued to make refinements in the lists and how they worked, always trying to improve our trading results - which means improving members' trading results. But we were frustrated at the cumbersomeness of managing trades. Sure, you can manage an open trade with paper, pencil and a hand calculator, but it's slow, it's a pain, and it's easy to make a math error. And try managing even 10 trades like this when the market drops!

So we invented a spreadsheet-based calculator that would show us the called and flat returns (flat meaning that we assume the stock price won't change) and show us the result of closing the trade immediately. Very importantly, it also allowed us to calculate the potential return from rolling the calls up or down, meaning to buy back the calls we sold and sell new calls with a different strike price. It was perhaps the world's first calculator for managing live covered calls. You see, we're traders; we built this to trade with.

We ultimately built a beautiful Java-based calculator that does all the things we wanted, the Trade Management Calculator™. It shows us the potential profit in the trade if the calls are exercised (if-called) or not exercised (the flat return). It shows us the actual result of unwinding the trade. Even better, it shows the potential results from two different rolls of the calls already sold. One click and you can see the trade management possibilities in an instant. It only stored 8 positions in memory, but it was a start.

That's how covered call trading should be! Covered call writers loved it, because it was designed by traders for traders.

2004: It's Tool Time, Big Time

In October 2004, we launched a new generation of Real Time Lists™ - literally bigger, better and way badder. Here are some of the changes we made (and didn't even raise prices):

• We went from 6 lists to 13 lists.
• We put a maximum of 30 trades on each list
• We separated pharmaceuticals and biotechs onto their own lists
• We created low-volume lists
• We created a list of ETFs (Exchange Traded Funds)
• We installed the ability to run the trade right from the list
• We added:
  • the P/E ratio
  • our proprietary volume momentum indicator
  • our proprietary moving averages (14- and 50-day) indicator
  • the company's industry

We also created the CallWriter Research Page. It opens with a mouse click and lets you research a potential covered call right from the list. A wealth of fundamental and technical information is available right at your fingertips, and there is no need to leave CallWriter.

We worked the calculator over, too. It got a face lift. More importantly, we built in a function to automatically update stock and call prices on each row. It npw updates prices with a mouse click. We upgraded the memory capacity from 8 to 24 trades.

Finally, we added over 100 pages of educational material to the CallWriter members' website - how to select, plan and manage covered call trades, as well as technical analysis for covered call writers. This material embodies much of the famed CallWriter Method, a complete and proven methodology for consistent success in covered call writing.

Autumn 2006 - Another Upgrade

We redesigned the non-member website, gave it a classier look and added a lot of valuable material. Also on track for October 2006: an expansion of the Research Page's capability, adding lots of important new research links. You can expect more charting, insider transaction links and lots more.

We also launched our new series of interactive covered call seminars, beginning with the basic and intermediate-level seminars.

Summer 2007 - Naked Puts and SuperPuts

We added lists of the highest-returning Naked Put plays, as well as our proprietary SuperPut plays. The SuperPut is John Brasher's term for a unique calendar collar strategy in which the investor buys the stock and writes a short-term call option (a covered call) and adds a long put with an expiration six to eight months out. The long put cost is extremely cheap in relation to the short call premium. The SuperPut strategy allows the covered call writer to insure the trade so that the greatest possible loss is only a few percent of the trade debit.

Spring 2008 - The New CallWriter Method Program

We have taken investing and trading education to a new level. A seminar is a great learning tool, and we continue to use them. But we have learned over the years that a seminar simply is not enough to turn a person into a journeyman investor or trader. More is needed. The mere acquisition of the requisite knowledge is not enough. Just important are familiarity and repetition. We have developed an extended program involving online follow-up sessions and online Coaching TeleLabs in which participants see - over and over - trade selection, trade planning and trade management (both yours and ours). This repetition and familiarity lead to true mastery.

We offer both basic and intermediate-level seminars.

The CallWriter Story Keeps Evolving

We will keep improving our tools and adding new tools, new lists and more education. We're traders and we know what you’re looking for. And we don't increase prices just because we add more value to the website.

What's next: more lists, an even better calculator? New tools we can't even talk about yet? Only one thing is for sure: if we add it to the CallWriter website, it is useful for covered call writing, and we use it.