Buying Back Covered Calls -

The Art of the "Un-Trade": Why Buying Back Your Covered Call Is Often Your Smartest Move

Closing a position early, known as "buying to close" (BTC), is the secret weapon for managing risk and maximizing capital efficiency. Here is why this "un-trade" is an essential part of your toolkit. 1. The 50% Rule: Harvesting Your Gains buying back covered calls

If your stock skyrockets and your call goes deep "In-the-Money" (ITM), you face assignment—meaning your shares are sold. If you’ve held those shares for 11 months, being assigned would trigger a , which can be significantly higher than long-term rates. The Art of the "Un-Trade": Why Buying Back