| Kymar, I love talking about options, especially in this kind of market (sideways to down). I look for 'stable' companies (little price change in the stock price) with good upside possibility, good balance sheet, growth, and reasonable price to earnings. I then sell the rights to the company to a speculator from month to month. It is great income on your core holdings. Even if you are assigned, usually you can buy back the company on a dip and re-sell. This strategy gives you a nice monthly gain before the month begins. Then you can spend your 'free time' watching the market and occasional day trading with your speculative money. In this case, you buy LENS at 12.25 on a dip Monday morning, when the stock appreciates a little on some buy program (to about 12.75), you SELL the rights to your position at the 12.5 strike for about 1.75 or 2. Thus if you buy 5000 shares ($61,250) and do the above, the market will immediately put $8,800-10,000 into your account, a 15% gain for 20 days of 'trading'. Do that every month for 12 months your return is about 170%. The key is the stock needs to stay around the 12.5 area without declining significantly. You never make the big run (like the old days) but you make a steady income. An even more conservative route is to sell 'in the money' calls ie. buy this stock at 12.25 and sell the 10 calls for about 3.5-4 which would still net you about 10-12% gain per month. I was looking at NEM (gold stock) to do this with. I have been doing it on BVSN the last 3 months. 10,000 shares getting $2 per month at the money. Think about it <G>! Steve D. |
