I don't agree. It depends on how deep the options you are looking at and what the expected move will be. There are too many variable to control. Theta (which is less since its deep in the money, Delta, Vega and overall implied Volatility.
I am welcoming your thoughts on the following strategy!
Imagine you have an IRA account where you can only do covered calls but no other options or short positions. As you all know, to write (sell) a covered call, I must first own the stock.
Now, I found a stock that is going to tank big time. I am fairly confident about it and wants to buy puts on it. However, I can only do covered calls.
My thought process is to buy this stock (knowing that this will go down) and then sell deep in the money covered calls and get higher premiums. When the stock falls big and becomes out of the money by the expiry date, those gains from the covered calls would more than offset the losses from the stock price decline.
Appreciate your feedback!