Porchies-
I'm a newbie to cc's, after discussions with Voltaire and Techguerilla, and reading Thorsett's "Getting started in options," I believe I am close to diving in.
I would some love response from y'all about how I am thinkin here.
First off, most of my equity holdings have a very low cost basis which I so not want to risk being called out of, so I plan to use other peoples money (margin) to buy my vehicle.
So, say I buy 600 QCOM at 130, immediately write Apr 132.50 calls for $11.50.
That would generate $6,900 for selling the 6 calls, and I would hope to have the shares called away, which would generate another $1,500, for a gain of $8,400. If they are not called away, I would just write calls against them again.
Am I getting this concept in general? It seems too easy, what am I missing here? Thanks Scott |
