SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Strategies & Market Trends : The Covered Calls for Dummies Thread
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: Dr. Id who wrote (471)5/8/2001 2:26:41 AM
From: FaultLine  Read Replies (1) of 5205
 
Selling covered calls requires no tieing up of capital.

Not exactly correct.

Last month I got into a situation where I was right at a margin call. At that time, I realized that I could not buy-to-close ANY of my outstanding covered calls unless I transferred additional capital or sold something. Almost everything in my portfolio was covered (except for a few hundred shares of NTAP) so I was extremely limited in my ability to sell securities from my portfolio to generate the necessary cash. I sold the NTAP, my only possible immediate choice, and produced sufficient cash to unwind a couple of cc positions that very day. I had not fully realized what a cash bind you can get into when attampting to unwind a cc.

Live and learn,
--fl
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2025 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News