Whether you’re new to trading or looking to broaden your horizons, learning new strategies can be daunting.
Even after learning them, you may hesitate to do it.
This is where it can be helpful to have software tools.
They can help set up and execute new strategies and make it easy to find the trades you are interested in.
One such tool that we’re going to review today is Born To Sell.
Born To Sell is a browser-based tool specifically designed to focus on covert calls.
For those new to covered calling, it also has an education section that covers many different aspects of covered calling, what they are, why you might want to trade them, etc.
Born To Sell also provides tools for advanced traders that allow them to search for specific criteria that meet their trading objectives.
Covered calls are a conservative trading strategy that can help you generate income from stocks you already own (or plan to own).
For every 100 shares of a share that you own, you can sell a call option against those shares.
If the price of the share is above the exercise price of the call option at expiry, your shares will be called at the exercise price of the call option.
If the price of the stock is at or below the strike price of the call option, you can keep your stock and the call option expires worthless.
Free covered calls course
Some might view this as a limitation on your upside potential, and they wouldn’t be entirely wrong.
However, covered calls have some additional benefits that may be harder to see.
First, selling a call option on your stock lowers your total cost base on the stock.
Second, it helps generate revenue that you can now use without having to sell your stocks.
(You might sell them later, but that’s the next benefit.)
Third, it “forces” you to take profits on your stock – and pays you for it.
You can structure the covered call so that the share price must rise by 5% or more before it is above the strike price.
Finally, it may even offer downward protection that you might not otherwise have.
For example, let’s say you have 100 shares of XYZ and you bought them for $ 100 each.
You can sell the $ 105 worth of call that expires the third week of the next month and we can do that for $ 2 / share.
When it expires, XYZ will trade at $ 105.01, so you will need to sell your shares at $ 105.
You made $ 5 per share on just the stock, but an additional $ 2 per share for the call you sold.
Yes, you “lost” that $ 0.01 per share if you could have stuck with the stocks, but you made $ 7 per share (7% ROI) in less than a month.
You could buy back the shares (at the higher price) and play the game again with a call option of, say, $ 112.50. 7% per month for 12 months is 84% per year.
For example, let’s say the price for XYZ stays at or below $ 100 year round.
If you just held the stock, you’d have a 0% ROI (at best). Not if you’ve been selling covered calls.
You would be making 2% per month or 24% on an annual basis – with a stock that literally works Nothing.
(This assumes you can sell the covered call for $ 2 / share every month.
Prices can and must fluctuate, so some months may be more or less than others.)
Or in the worst case scenario, the share price falls.
By selling the first month’s call for $ 2, you dropped your cost base to $ 98.
That means you have down 2% protection for that month.
Versus just holding the stock and you have no protection.
Born To Sell provides tools to help new and seasoned traders find covered calls that match their criteria.
There’s a top 10 list for those who aren’t sure where to start or those who are interested in some of the most popular covered calls.
There is a search option that can find all of the available options based on the criteria entered.
By default, the next expiration times are determined at or near the actual share price for shares above $ 10 / share.
These options can be changed to further narrow the results.
There are special search modes for advanced traders who want to capture dividends without risking earnings, deep in the money calls (which offer different benefits with different risks) and other advanced search functions.
Columns can be sorted as desired and prices are updated during market times.
There is also an income goal finder.
You enter your capital, monthly goal, margin, and the number of positions you want to manage, and a list of possible matches that meet those criteria is created (obviously there are no guarantees; individual stock performance and general market direction can and will affect the results).
There’s also a chain view that lets you focus on a specific stock and highlight ex-dividend or earnings dates before it expires. This can help you choose options to prefer or avoid based on your preferences.
All of these options provide additional data such as downside protection, percentage return (if unchanged) and annualized return.
There is also a portfolio manager for traders / investors who already own 100 or more shares in a single company.
You can enter the stocks in which you own 100 or more stocks and possible options for covered calls against them will be offered.
If you are selling a call against stocks you own, you can enter that too. It tracks how much time is left, what upside potential and what intrinsic value is available.
There is a nice dashboard area where you can view the details of your entered positions both graphically and in table format.
And never be surprised by earnings or ex-dividend dates for the stocks you own using the calendar (on the portfolio overview page).
The Portfolio Manager also has sections called Cover Me, Roll Me, and Diversify Me. These are pretty simple:
Cover Me explores potential what-if scenarios for stocks that you own but have not yet sold calls.
Roll Me examines existing positions to which you have sold calls and offers options for introducing a new expiry and / or strike. and Diversify Me shows how the stocks you own by industry and shows you where you might be over / underweight compared to the S&P 500.
You can use this to search for stocks in a specific industrial sector if you want to match the overall market – or if you want to focus on a specific industrial sector.
The Portfolio Manager is rounded off by the History section.
Once you’ve sold (or withdrawn) your stock, you’ll be given details of the income you made on that stock, plus the income statement per share and grand total.
When you have a stock (or multiple stocks) in your sights, there’s a watchlist feature that lets you enter symbols that you’d like to receive email updates for potential buy writes (buying the stock and selling one at the same time covered call).
Born To Sell is relatively straightforward in terms of looks. However, each of these features lifts a lot of weight, which can save time amplitudes.
While there are many features and details about existing and potential locations, it can be a little tricky to find exactly where the data item you’re looking for is.
Some of this will likely get easier the longer you use the tool, but it can be a bit overwhelming for those new to trading.
Born To Sell offers 3 pricing options:
- $ 60 / month
- $ 150 / quarter ($ 50 / month average)
- $ 500 / year (~ 42 / month avg)
They also offer a free 2 week trial for each option you choose.
It is fully functional within 2 weeks, without any restrictions.
Cancel before the 2 weeks are up and there are no fees.
You can change or cancel the options at any time.
- Tons of features to find / manage covered call positions
- Simple interface for filtering results
- Can enter his own portfolio of stocks for potential covered calls as well as for tracking positions
- Saves a lot of time trying to find covered calls and calculate potential returns
- An extensive learning library with videos and links to additional material (free of charge without subscription)
- Lots of tables / numbers and very few graphics
- The results of the watch list are not sent by email until the end of the day. Not available in the tool
- It can be difficult to find specific data without moving from feature to feature (each feature shows a different subset of data).
A tool is valuable only in that it can save (or make) you more than it costs.
Born To Sell absolutely saves time trying to find potential covered call positions and calculate the potential returns, etc.
In and of itself, however, this may not justify the $ 42 to $ 60 per month.
While it is possible to find covered calls that cost more than the cost of an account of $ 5,000, it would put too much risk on a single position.
Of course, you need to determine your own risk tolerance to determine whether or not it is right for you.
Covered calls are one of the more conservative trading strategies, but one that is more capital intensive than others.
If you have a small account (<$ 25,000) you may not be able to take full advantage of Born To Sell. However, your diversification options may be limited, which can affect your skills more than the cost of the tool to make.
Seasoned traders who are more aggressive can handle the cost of the tool well, but for new and / or occasional traders / investors it is better to only use Born To Sell if your account was 6 digits or more.
This would allow you to diversify your trades so that not everything depended on a single stock or two.
Every trader / investor needs to determine if a particular strategy or tool is right for them.
For those with capital looking for a more conservative way to generate income from stocks they already own or plan to own, Born To Sell has a nice collection of tools specifically geared towards covert calls.
Disclaimer: The information above applies to For educational purposes only and should not be treated as investment advice. The strategy presented would not be suitable for investors who are unfamiliar with exchange-traded options. All readers interested in this strategy should do their own research and seek advice from a licensed financial advisor.