How To Write Covered Calls - An Ongoing Real Case Study! Message Board

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Strategies & Market Trends : How To Write Covered Calls - An Ongoing Real Case Study!

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To: Joe Waynick who wrote (7081)	3/17/1998 12:16:00 AM
From: EJ	Read Replies (1) of 14162

Joe, The issue in the original post was trying to address the concern of buying the stock, but not being able to sell the call. My point was simply sell the call first with a limit order. Then immediately (if desired) upon confirmation, buy the stock. You can also use this strategy to improve your position. Here's an example of a stock I'm currently watching...I'm not recommending the following trade. PWAV traded up 5/16 today to 15 1/16 and the April 15 traded up 3/16 to 1 5/8. A play may be to sell the call (naked) at 1 5/8 (assuming we can get that tomorrow). Then, later in the day, or in the next couple of days, buy the stock on normal volatility if/when it bounces down to around 14 3/4 - 14 7/8 (a price at which you could buy PWAV about 8 of the last 10 days). EJ

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