Hi Ryan and fellow lurkers,
I understand your strategy, but my point/questions were mostly related to difference in stock ownership CCing versus LEAP CCing.
I think, I understand your question and your points in the conversation. That's good you bring it up the finer details. There are pros and cons to any type of investing.
On the one hand, CCing stocks is easier to learn when one first begins dealing with options. On the other hand, LEAP spreads offer fantastic profit potential for the investor comfortable with the stock CCing process and understanding.
Including a portion of the portfolio positions with LEAP spreads is relatively easy money with a modest increase in risk. Good chart reading skills and a cool head reduces that risk considerably.
Believe me, I read every post your write, I bookmarked this subject the first day you started it. I just think there are some fundamental differences between stock and LEAP CCing that are potential pitfalls. I follow WINS very closely, I feel it is an accurate system, provided you have picked a good stock. I was just curious because LEAPS add that new dimension of time premium working against you, and not for you as we usually expect in a stock ownership CC situation.
Yes, we are in agreement. I would like to explore this type of investment some more. It is a close cousin to writing covered calls. As I write, I'm working on the LEAPs table that will provide some data on my web site. First, to list all of the stocks that offer LEAPs. Second, to present a quick way to plot them with the BB and RSI. Third, to eventually sort them by profit potential. That will be the last feature added and the most involved technically from a programming standpoint. If anyone has suggestions from a programing solution they can email me. |
