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Strategies & Market Trends : VOLTAIRE'S PORCH-MODERATED
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To: Dealer who wrote (1635)9/15/2000 4:58:05 PM
From: SE  Read Replies (2) of 65232
 
Covered Call Option Writing: Month One. 


JDSU		
8/18/00		
200 Shares		
Purchase	24300	
Value Today	20738	
Option Money	1075	

If I did nothing w/ original write:		

Option Money	1775	

No Write Program	-14.66%	
With Writing	        -10.71%	
Just Original Write	-7.93%	
		
ELON		
8/18/00		
700 Shares		
Purchase	26381	
Value Today	25988	
Option Money	-1574	

If I did nothing w/ original write:

Option Money	4113	
		
No Write Program	-1.49%	
With Writing	        -7.04%	
Just Original Write	16.71%	

RMBS		
8/18/00		
300 Shares		
Purchase	25313	
Value Today	23850	
Option Money	2213	

If I did nothing w/ original write:

Option Money	2513	
		
No Write Program	-5.78%	
With Writing             3.25%	
Just Original Write	 4.61%	

QCOM		
8/18/00		
400 Shares		
Purchase	24500	
Value Today	26500	
STOCK CALLED	24000	
Option Money	2000	

If I did nothing w/ original write:

Option Money	2000	
		
No Write Program	8.16%	
With Writing	        6.67%	
Just Original Write	6.67%

JDSU

On 8-18 I wrote the Sept 120's for 8 7/8. On 8-22 I bought the 120's back for 11 and wrote the Sept 125's for 7 1/2. I did not roll down as JDSU fell. So here there were two mistakes made. First, let original write work for you and don't just rewrite immediately. The original would have expired worthless. Second, once the stock falls as much as
JDSU did, I should have done some rewrites on the way down probably.

ELON

On 8-18 I wrote the Sept 35's for 5 7/8. On 8-30 I bought the 35's back for 11 1/2 and wrote the Sept 45's for 3 3/8. I did not roll back down with the stock as it fell. Should
have left well enough alone and just stuck with the original write.

RMBS

On 8-18 I wrote the Sept 85 for 8 3/8. On 8-22 I bought them back for 10 3/4 and sold the Sept 90's for 7 7/8. On 8-29 I bought back the Sept 90's for 4 3/8 and wrote the Sept 85's for 6 1/4. I should have done the same likely with ELON as RMBS came out ahead in the end. Here again, though the original write was the correct course and I should have just stuck with it.

QCOM

On 8-18 I wrote the Sept 60's for 5. I did nothing else with this write and the stock was called at 60.

On each the original write would have produced the best gains without any monkey business. 

OVERALL portfolio:		

Original Purchase	100494	
Option Money	          3714	
Original Option	         10401	
Ending Value	         97076	
Ending Value		
with QCOM Called	 94576	
		
No Write Program	-3.40%	
With Writing	        -2.28%	
Just Orig Writes	 4.98%

So with original writes, I would have made 5% in a month three of the four stocks dropped in value. Since I felt the need to do some half baked management I ended up losing 2.28%. Had I done nothing but buy the stock outright I would have been down 3.40%. So in the end, the half baked writing I did saved me money.

I think I did all the computations correctly. I hope so anyway.

-SE
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