[skindog]

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do covered calls generate excess after tax returns over just buying and holding the stock for long term investors?

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I'm gonna get back in on this

I don't think bringing up specific examples does anything to bring the discussion one way or another. I can find a mountainload of cases where writing a covered call resulted in more profit than either buying the stock by itself or writing a call by itself.

Personally, I do it for stocks that I am bullish on (I wouldn't want to hold stocks just for covered call writing) if I feel both that the option provides a good reward and that the stock's raw 'volatility' isn't a good representation of whether the stock will reach a certain level. It is definitely more of a trading thing than an investment thing.

Just because I'm bullish on the stocks I buy, I might be hesitant to write something like the AAPL 125 call. Yes, you get a lot of cash for your time value, but like you pointed out - it's for a reason. In my covered call writing I leave enough room such that if the stock spikes and does hit the strike price, I will be very happy with my stock returns for the month. In all cases, I use it as something of a bonus return for my investment rather than an end-all strategy.

Like I said, I have a feeling that properly used, under specific circumstances that certain stocks face, covered call writing might bring abnormal returns. I don't write covered calls for every stock I own.

I can tell you definitively that I've made more money using covered calls than if I had not used them.. but that obviously doesn't prove anything with my short investing timeframe.

I think the most useful way of proving any point would be for either side to bring some articles or sources to the table.