There is more than one way to skin a cat. But some ways are more buying power efficient than others ... .

Here, I'm looking at a covered call in X. The implied volatility is >50%, so I can get a bit of premium on the call side to reduce my cost basis in any stock I buy here. For example, if I buy shares at 20.38, and sell the Sept 30th 20.5 call against (for a 1.50 ($150) credit at the mid), I can get into the whole package for a 19.03 debit ($1903), my cost basis in the shares will be $19.03 per share, and my max profit is $147 if called away at 23. However, for some, that $1903 stick price can be hefty, especially if they're working with a smaller account. The drawback is that I'm (a) stuck with stock I bought at 20.38 per share; and (b) the buying power effect may be larger than I'd like.

In comparison, I can also do a PWCC or poor man's covered call. Traditionally, this is set up using a long-dated, deep ITM             long call option to stand in for the stock and -- like the covered call -- a call sold 30-45 DTE             . Most of the time, I set these up using the 70 delta strike for the long option and the 30 delta strike for the short. As with the traditional covered call, I'm looking to reduce my cost basis in my "synthetic stock" (here, the long option) by selling calls against. Compared to the traditional covered call, the PWCC has a smaller price tag -- $361 (which is also my max loss for the setup, assuming I do nothing at all), and I look to exit the setup as a whole at 10-20% of what I paid for the setup which, in this case, isn't as attractive as the $147 max profit of the covered call. However, there is one other aspect of the setup worth noting -- my buying the Jan 20th 18 call gives me the right to exercise for shares at $18. With the covered call, I'm locked in with 20.38 shares; with the PWCC, I'm not.
Comment: I would note that with the PWCC, you can naturally go lower with the long-dated long call to give you the right to exercise at a lower stock price. However, as you go deeper in the money with the long call, the value of the long call increases, so the setup becomes pricier. Additionally, you'll also notice that the volume and open interest (and therefore liquidity) in those deep in the money calls becomes thinner as you go deeper, posing difficulties with getting filled at "a fair price." As always, there's tradeoffs between max loss, max profit, and buying power effect ... . Additionally, sometimes a juicy dividend may militate in favor of doing the covered call (you won't get the divvy with a PWCC); here, with the .05 dividend, I don't consider it a factor, since that's a mere $5 for every 100 shares owned.
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