Now that we have given you the steps to Sell Naked Calls, let's go through an example. The stock you are going to use for this example is California Amplifier, Inc. (CAMP).

This example comes from the CallsAndPuts.com "Sell Naked Calls" data. Let's go through the procedures step-by-step:

1) You select CAMP from the "June Naked Calls" listing:



2) You select CAMP based on the criteria you've established for a good Sell Naked Call candidate (This differs for each option investor based on risk versus reward criteria).

3) Let's assume you read the latest news on CAMP and you've determined, through your research, that the stock will move in a neutral to bearish pattern in the near-term.

4) You access the Stock, Option, BB&RSI links and based on your risk versus reward criteria determine that CAMP is your naked call option investment choice.

5) Let's also assume that you have an account with ETrade, have met the brokerage requirements to write naked calls (uncovered calls) and want to place your order for the sell naked call option position.

6) Once you log into your account on www.etrade.com, access the Trading > Enter Option Order link. 

7) Place your option order for 5 contracts by selecting the following fields:

8) This sale of the CAMP call option is for 5 contracts (500 shares of underlying stock) at market price. If you want to sell your naked call position at a specific option price, select the "Limit" radial button and enter the price.  

9) Selling naked call options requires the investor to watch the underlying stock price throughout the expiration period.  If the stock price has moved up, then the call option position should be closed to avoid heavy losses. This can be done with the following menu selections.

CoveredCalls.com

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