>buy a somewhat bullish stock >sell an in the money covered

>>1939013
Nothing, only the chance of the stock going down

It's free money! What could possibly go wrong

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>>1939022
>I could've been making 1-2k a month on my stocks for the past 5 years

>stock crashes
>they let the option expire
>you're left holding the bag

Damn son you are fuckin stupid

>>1939097
Furthermore
>stock moons
>you get only the premium, which is comparatively small compared to the price rise

>>1939013

Selling an ITM covered call means that when they take it away, you have to sell the stock at a lower strike price, so you are netting around 0. Possibly negative. Possibly VERY slightly positive.

>buy stock at $10
>sell ITM call of strike $9.
>value of option can be simplified to time + moneyness
>ITM options rely less on time value and more on moneyness, so when you subtract the current stock price from the ITM option value, they are nearly identical. Option might be worth around $1.1~
>stock rises and it for sure gets called away and all you made was the slight slippage of difference between premium and selling price. So 100 shares at $10 = $1000. Then you have to sell at $9, meaning a net negative $100. Add in the premium $1.1 x 100 = $110. $110-100 = $10.

You made $10 on a $1000 investment. You can only do this 4x a month max. And I should mention your biggest flaw, which I generously ignored in the example above.

>expires next day

You won't have any time premium to give you any sort of slippage, so your ITM options will almost definitely be the exact same as the actual stock, so you won't make anything. If you are lucky, you might make a dollar, MAYBE, and that's being generous and excluding commissions, which will then send you negative.

There MIGHT be free money, but it's going to be literal pennies. Yes, your biggest risk is your stock going down, which a small decrease will overpower any gains you make. This strategy would most likely return less than a 1% a year, more likely being negative.

I'd recommend just selling out-of-the-money cash secured puts at strikes you feel comfortable with, for companies that are actually worthwhile. And if a dip occurs and you get stuck with the stock, you have a company you like, and can start selling out of the money covered calls. That will net you a nice little return and be far easier to manage.