Call: An Option contract that gives the holder the right to buy the underlying security at a specified price for a certain, fixed period of time.

Cover: To close out an open position - to buy back as a closing transaction an option that was initially written. This term is used to describe the purchase of an option or stock to close out an existing short position for either a profit or loss.

Covered: A written option is considered to be covered if the writer also has an opposing market position on a share-for-share basis in the underlying security. That is, a short call is covered if the underlying stock is owned, and a short put is covered (for margin purposes) if the underlying stock is also short in the account. In addition, a short call is covered if the account is also long another call on the same security, with a striking price equal to or less than the striking price of the short call. A short put is covered if there is also a long put in the account with a striking price equal to or greater than the striking price of the short put.

Covered Call Option Writing: A strategy in which one sells call options while simultaneously owning an equivalent position in the underlying security or strategy in which one sells put options and simultaneously is short an equivalent position in the underlying security.

Uncovered call option writing: A short call option position in which the writer does not own an equivalent position in the underlying security represented by his option contracts.

Uncovered Call Writing: A short call option position in which the writer does not own an equivalent position in the underlying security represented by his option contracts.