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7 Covered Call Trades on Today’s Hottest Names

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Trade #7 – McDonald’s, Another Way to Play

Recommended by Jim Woods

If you’re looking for a longer-term position on McDonald’s Corp. (NYSE:MCD), this strategy offers you another way to play this fast-food giant.

This supersized Dow component’s stock tastes really good these days, and over the past year MCD shares are up more than 27%.

The company just reported a 7.4% surge in November same-store sales, and that news caused shares to spike to an intraday all-time high of $98.43 on Friday, Dec. 9.

If you’ve been a MCD shareholder for any length of time, you know how satiated the shares have made you feel. But by using a covered call, you can supersize your profits even more.

If you own (or buy) the stock below $98, then writing a call such as the MCD June 110 Call will allow you to collect a very nice premium. It also will lock in about another 12% upside from current levels if the shares are called away.

With that kind of locked-in upside, you’ll have plenty of cash to keep you in Happy Meals for a very long time!

Article printed from InvestorPlace Media,

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