For selling calls, you want to make this contract when you think the stock price is going to go down. Again, like selling puts, the only money the seller (of the call) makes is from the premium from the call buyer. When you enter into this contract as a call seller, you agree to allow the call buyer to buy a stock at a certain price (called the strike price). Obviously if the price goes above the strike price, the call buyer will execute (since they will be taking the stocks from you at a lower price than the market). Of course if the stock price remains below the strike price, the call buyer wouldn’t execute the contract since buying the stock from the market makes more sense since the price is cheaper.

Some notes: In some cases you actually don’t own the stock the call buyer has the right to buy from you. This is called a naked call. So if the call buyer executes, you need to actually buy the stock from someone else (which obviously is more risky for the call seller than if this were not a naked call. If the call seller already has the stock, it’s called a covered call).

Some questions:

-does the contract have to start when the stock price is below the strike price?

Resources: https://www.investopedia.com/ask/answers/06/sellingoptions.asp