My oldest started trading (-)volcorr (mkt up/vol down) by buying 50 shares of spot and selling one OTM call. It's the same as a synthetic-straddle but a half-lot. It allows for diversification in odd lots.
MathT Didn't read all of the thread. 500 shares is a perfect amount to ladder out. I don't know your cost basis, which is important. Also, what is your goal? That will really dictate your strike price. I'd crawl before I walk, walk before I run. Do one contract next week, preferably above your cost basis. See how it works out. At the end of the week, roll it out.
Math, you're doing fine. Do the CC with the put buy backs for protection. Understand it fully...Do not pass go, do not collect $200. The last thing you want to do is blow up an account...Not understanding what you are/were doing. Getting a sticky finger or something. As you gain the knowledge, explore further into options...
Des, he said he has done about 3 puts in his lifetime!! He is still working on CCs...With put protection. He has never laddered with time or price on CCs. Let him walk first...Understand what happened. PS He made money on both sides...Hardly ever done for newbies.
Stock + put - call = synthetic bull spread. He can simply price the 111/120 bull spread to monitor the position. It is the reduced position and has utility in that it appears less abstract
That's what he did with the 500 shares of XOM...At earning time. No rabbit hole here but, his wife doesn't even want him to do covered calls. I know because it happens to me...Quality stocks get called away and you are left with dogs. What I have ended up doing (just me), is doing leaps on quality stocks way OTM. For stocks you want to hold onto, XOM seems like something you want to keep for years/decades... Except for solar, a pipe dream as per Homer.