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Strategies & Market Trends : The Covered Calls for Dummies Thread
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To: Road Walker who wrote (2316)8/31/2001 9:13:54 PM
From: 100cfm   of 5205
 
John

I understand better what you're trying to point out.
But to us dummies we look at it one way. When the stock goes down so does the price we can sell a certain call for or buy that call back if we were lucky enough to sell it when the stock was at a higher price.

But yes the premiums don't move in lock step with the stock price and mostly to our disadvantage. Meaning when you've sold calls the premium doesn't vanish fast enough as the stock price declines and when your long calls the premium doesn't rise fast enough as the stock price climbs. At least that's they way it seems when it's your money is on the line.

100
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