David S. Silver, CFP®, CEPA®'s Linkedin Analytics

"I'm not selling my shares. I'm simply renting out the upside I was unlikely to capture anyway." This is how one of our clients explained their covered call strategy. It's about optimizing assets. Successful implementation requires careful consideration of strike price, expiration dates, and position sizing. For example, an executive with $2 million in company stock could generate significant income over time, which can be reinvested to diversify their holdings. -- The above is a strategy that uses options. Options are complex securities that involve substantial risks and are not suitable for everyone. A covered call strategy involves selling call options on an underlying asset that is already owned, with the aim of generating additional income on the position from the option premiums received. This strategy carries various risks due to its complexity, and namely, that it sacrifices potential upside limited by the sold call, carrying an obligation to sell the underlying asset at the call option’s strike price if exercised, and offers no protection against significant declines in the underlying asset, among other risks. Please consult a professional regarding any investment to determine it is appropriate for you, especially complex positions like a collar strategy using options. *Instrumental Wealth is an investment adviser in Tampa, Florida. Instrumental Wealth is registered with the Securities and Exchange Commission (SEC). Registration of an investment adviser does not imply any specific level of skill or training and does not constitute an endorsement of the firm by the Commission. A copy of Instrumental Wealth's current written disclosure brochure is available through the SEC's website.

"Sleep insurance" is how one client described using a collar strategy. It's about knowing the worst-case scenario and finding comfort in that certainty. Implementation considerations include choosing between zero-cost and premium collars, strike price selection, and duration/rolling strategies. In turbulent markets, collars can limit potential losses significantly. -- The above is a strategy that uses options. Options are complex securities that involve substantial risks and are not suitable for everyone. A collar strategy involves buying an out-of-the-money put option and selling an out-of-the-money call option, on an underlying asset that is already owned, with the aim of protecting against a significant loss in the underlying asset position. This strategy carries various risks due to its complexity, and namely, sacrifices potential upside limited by the sold call, not completely or not effectively protecting against losses as intended, and the risk of the options being assigned prior to expiration, among other risks. Please consult a professional regarding any investment to determine it is appropriate for you, especially complex positions like a collar strategy using options. Investing in securities involves risk of loss that you should be prepared to bear. We do not represent or guarantee that our services or methods of analysis can or will predict future results, or insulate clients from losses due to market corrections or declines. We cannot offer any guarantees or promises that your financial goals and objectives will be met. Past performance is in no way an indication of future performance. Instrumental Wealth is an investment adviser in Tampa, Florida. Instrumental Wealth is registered with the Securities and Exchange Commission (SEC). Registration of an investment adviser does not imply any specific level of skill or training and does not constitute an endorsement of the firm by the Commission. A copy of Instrumental Wealth's current written disclosure brochure is available through the SEC's website. This post does not constitute advice or a recommendation or offer to sell or a solicitation to deal in any security or financial product. It is provided for information purposes only and on the understanding that the recipient has knowledge and experience to understand and make an evaluation of the information, the risks associated therewith, and any related legal, tax, or other material considerations.

No single option strategy is a universal fit, and what works today might not be the best tomorrow. As advisors, we recognize that it's essential to acknowledge each executive's relationship with their concentrated position. This goes beyond just the numbers. There are often deep-seated emotional attachments, career considerations, and even legacy implications tied to these holdings. Therefore, the ideal approach isn't a one-size-fits-all solution. It's about balance. --- This post references strategies that uses options. Options are complex securities that involve risks and are not suitable for everyone. Option trading can be speculative in nature and carry substantial risk of loss. It is generally recommended that you only invest in options with risk capital. A call gives the holder the right to buy an asset at a certain price within a specific period of time. Calls are similar to having a long position on a stock. Buyers of calls hope that the stock will increase substantially before the option expires. A put gives the holder the right to sell an asset at a certain price within a specific period of time. Puts are very similar to having a short position on a stock. Buyers of puts hope that the price of the stock will fall before the option expires. Selling options is more complicated and can be even riskier. Investing in securities involves risk of loss that you should be prepared to bear. We do not represent or guarantee that our services or methods of analysis can or will predict future results, or insulate clients from losses due to market corrections or declines. We cannot offer any guarantees or promises that your financial goals and objectives will be met. Past performance is in no way an indication of future performance. Instrumental Wealth is an investment adviser in Tampa, Florida. Instrumental Wealth is registered with the Securities and Exchange Commission (SEC). Registration of an investment adviser does not imply any specific level of skill or training and does not constitute an endorsement of the firm by the Commission. A copy of Instrumental Wealth's current written disclosure brochure is available through the SEC's website.