Kevin Kelly's Apple Trade

Kevin Kelly, the managing director of Kelly & Co., spoke on Bloomberg Markets about a covered call strategy in Apple Inc. AAPL.

Kelly said people are always worried about putting new money to work in names that are hitting new highs, especially in names like Apple, which reached a new high on Tuesday. He added that one way to get a long exposure is with a covered call strategy. Kelly suggested that traders should buy the stock and sell the January 180 call for around 2 percent of the underlying. The strategy offers a potential upside of 12.50 percent and a 2 percent protection.