Mike Khouw's Home Depot Options Trade

On CNBC's "Options Action," Mike Khouw suggested that investors with a long stock position in Home Depot Inc HD should consider a covered call options strategy.

Khouw wants to sell the August $265 call against a long stock position in Home Depot. He is going to collect around $4 or 1.60% of the current stock price. The strike price of the call is around 6% above the closing price on Friday.