No. of Recommendations: 2
These covered call writing strategies seem to me to be a very risky way to earn 10%.

Yeah, unfortunately buy-write (and put-writing) returns are currently depressed by the market's very low implied volatility (which some have even tagged as a sign of over-confidence in the market, though there's plenty of controversy about that interpretation), as exemplified e.g by a ^VIX below 11 (!).

As a result I've curtailed my use of buy-write (and put-writing) strategies, until enough "normal" fear and anxiety return to the market (I'm not asking for a panic -- a "normal" ^VIX above 15 might be enough!-).

In the meantime, there are still slightly more complex option strategies, such as diagonal spreads, that can provide more acceptable income returns if deployed with savvy and prudence.

But, I don't think they're suitable for discussion on a bonds-focused board as they do require more learning and ideally some hand-holding until the investor gains experience and confidence in deploying them -- used otherwise, derivatives can indeed prove to be "weapons of mass financial destruction" as Buffett once tagged them.

To anybody interested I would recommend the premium service "Motley Fool Options" -- not sure if it's open to new subscribers right now, or if it has one of those great offers for "all your money back if you cancel within one month" which let you get a good feel for how a service operates, without paying for the subscription unless you really like what it buys you; if not, I'd advise waiting until it opens that way again (and meanwhile one can get on the waiting list to be alerted when it does).
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