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Strategies & Market Trends : Advanced Option Strategies

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To: Greg Higgins who wrote (1)7/4/1998 11:32:00 AM
From: Douglas Webb  Read Replies (1) of 355
 
I've been thinking about Systematic Writing, and I'm interested in putting some tools on my site about it.

Am I correct in assuming that the short puts, calls, and straddles are all written using at-the-money options? You get the most time-premium that way... Are there situtations where you'd want a different option?

Also, it sounds like you'd always uses fairly short-term options; no more than two months out. Is that right?

What do you do with the stock if you still own it after the round of covered calls? Do you keep writing calls, or sell it and move on? What do you consider when making this decision?

Finally, what kind of delayed-quote tools could I develop that would be useful for this strategy? I can't do anything with the first step (choosing a stock) but I can help with the rest...

Thanks.
Doug.
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