Gorilla and King Portfolio Candidates Message Board

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Strategies & Market Trends : Gorilla and King Portfolio Candidates

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To: Wyätt Gwyön who wrote (5637)	8/30/1999 6:25:00 PM
From: edamo	Read Replies (2) of 54805

g.moore...re: leaps most common mistake is to buy calls based on premium...same as buying a car and only caring about your monthly payment...got to know the real cost, more otm, longer upside down, object is to stay or get itm asap, or else risk of prem loss... the higher strike/lower premium always has a higher volatility(percentage wise)attached to it....easy to get caught in a rising stock, but lose due to time erosion. always buy, regardless of premium that which gets you as close to par with the common. best time is on a sell off, which is also optimum time to sell the put...call/common buy go hand in hand insofar as timing with put sale(sell off)...conversely call write and cover or buy back put optimum on run up. i know you guys and jill are rabid qcom believers, but i would have written calls when it was at or above 190....momentum issues never track straight up...lot of ups and downs to open and close option writes...i would be a strong seller of qcom puts in the low 170's......i know we will never see that level again! as previously posted, comments not stock specific, hold true for any issue...better to give up great leverage, as last man holding loses, for stock replacement method.......remember you can write a covered call against the call you own, same as stock

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