Disclaimer ETF
IMPORTANT NOTE: Capital Wealth Planning, LLC, (CWP) is an SEC registered investment adviser. Capital Wealth Planning, LLC only transacts business in states where it is properly registered or in compliance with applicable state regulations. Individualized responses that involve actual or contemplated securities transactions or the rendering of personal investment advice for compensation will not be made absent compliance with all applicable investment adviser regulation requirements. Please contact the sender if there are any questions.
Capital Wealth Planning, LLC is an investment advisory firm located in Naples, Florida. Capital Wealth Planning and its representatives are in compliance with the current registration requirements imposed upon registered investment advisors by those states in which it maintains clients. Capital Wealth Planning may only transact business in those states in which it is registered or qualifies for an exemption or exclusion from registration requirements. Any illustrations used in this website are hypothetical. The results achieved by individual clients will vary and will depend on a number of factors including the particular underlying investments and their dividend yield, option market liquidity, interest rate levels, implied volatilities, and the client's expressed return and risk parameters at the time the service is initiated and during the term. Past performance is not a guarantee of future returns. Investing in options involves risk that must be considered and reviewed with a professional prior to investing. This website is not intended for the giving of investment advice to any single investor or group of investors and no investor should rely upon or make any investment decisions based solely upon contents of the brochure.
This illustration of potential portfolio cash flow from a covered call option writing program is not based on an actual portfolio. Covered call option cash flow for any portfolio will vary depending on actual portfolio positions, option premiums received, individual ETF price volatility, and general stock market volatility. Positions covered by call options may be called away, creating realized capital gains or losses. Cash flow is not guaranteed over any period. More information may be found in CWP’s Form ADV.
Option trading is not suitable for all investors. The booklet “Characteristics and Risks of Standardized Options” can be found at: http://www.optionsclearing.com/components/docs/riskstoc.pdf . Hard copies of the smae may be ordered by calling 1-888-678-4667 or writing OCC, 1 North Wacker D. STE 500 Chicago, Il 60606.
Risks to Consider:
While CWP takes considerable care in reducing the possibility of having shares called away, there can be no guarantee that the owner of the call option will not exercise the option prior to CWP’s repurchase of the sold option.
The actual income from the strategy will depend, to a large extent, on the Target Price of the underlying ETF. Therefore, the amount of incremental cash yield is predominantly determined by investors’ individual risk tolerances and willingness to sell the concentrated position.
Covered Call writing can provide limited downside protection. It does not, however, eliminate downside risks. Options involve risk and are not suitable for all investors. Prior to opening an account with Capital Wealth Planning, clients are required to understand the risks associated with the purchase or sale of options by receiving the Options Clearing Corporation Publication, “Characteristics and Risks of Standardized Option Trading”. Copies of this document may be obtained by your Financial Advisor or the Option Clearing Corporation.
