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: NateC who wrote (11546)	9/19/1999 11:12:00 AM
From: Tom K.	Read Replies (3) of 14162

would you mind amplifying a bit on this? Nate, there are a variety of ways to handle it. One example: if you really want the stock to do CC's against, let's say DELL which is currently at 49, instead of just buying at 49, sell the Oct 50 PUT for 3. You will effectively pay 47 (50-3) for a 49 stock if PUT to you. If it jumps above 50, it won't be PUT to you and alas, you'll have to simply pocket the premium and do it again. And yes, if it expires below 50 and is PUT to you, yes you will be down.... but, you were willing to buy it at 49 to do CC's... so what's wrong with buying it at 47 ?? Hope this helps. Good luck. Tom

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