What does a covered call option strategy generally entail for investors?

A covered call option strategy involves an investor holding a long position in an underlying stock and simultaneously selling (or writing) call options on that same stock. This approach allows investors to generate income from the premiums received from selling the call options while potentially offering some downside protection against a decline in the stock's price. If the stock price does not rise above the strike price of the sold call options, the investor keeps both the stock and the premium. If the stock price exceeds the strike price, the investor may have to sell their shares at that price, potentially missing out on further gains, but they still benefit from the premium collected.

In this context, the other options do not correctly define a covered call strategy. For instance, simply buying stock without any options does not entail any options trading. Buying put options is a different hedging strategy aimed at protecting against losses and does not involve selling call options. Holding options until expiration can apply to various strategies but doesn't specifically describe a covered call approach, which focuses on the combination of owning shares and writing call options.