Boy people have made this complicated. 1. My original suggestion was that even if you sell at the bid, you can sell a deep in the money covered call that will protect the price of the stock from going any lower and if exercised against you will give you more $ than the stock was trading at when you made a choice to sell the calll instead of cashing out the stock. 2. I've been trading options for 5 years and like many option traders I usually buy options that are 3 mos. out. From the time I buy the option until it expires the price usually goes up and down a fair amount . I frequently have a position drop below my purchase price and if I think it might drop more I sell near month options against my longs and then buy back the shorts at a cheaper price when the stock goes the way I originally thought it would. I'm not a pro but I think you will find that many professional option traders trade spreads rather than just having large positions of naked options. 3. Straddles and strangles are strategies that can work very well in volatile situations and I've no problem shorting against the losing end of either once the trend is established. And finally, if the general trend is up and I think it will continue I willl hold my calls and scalp puts on the days the stock/market drops. If that makes me a rank amateur in your eyes, that's fine with me.
Chris your strategy makes sense. Never mind this Xflat2186 he is a lunatic hopping around threads taking his anger out on people. He serves no useful purpose. You are no amateur you have been trading options for 5 years and thats a longtime.
Some institutions and hedge funds do sell leap calls deep in the money. They get a annualized 25-30% return without having to hassle new writes every month. Its works like a owning CD at the bank with 25-30% returns. Not bad . Its a strategy I use myself for 40-50% downside stock protection when I need it.