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Strategies & Market Trends : The Covered Calls for Dummies Thread
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To: FaultLine who wrote (841)5/31/2001 9:43:57 AM
From: JohnM  Read Replies (1) of 5205
 
Ken,

Thanks for the note. On the NUFO Jul 12.50s premium price, you are right. I just checked another source and your information is the same. So I went back to the printout I worked with last night. Sure nuff, it shows a $4.10 premium for the Jul 12.50s. But, as I look closer I can see it's clearly an anomaly. The bid/ask range, which I should have checked, is 1.05 to 1.03. Just greed. I'm looking too hard for the best deal and not checking carefully. But the mistake is troubling since it came from the CBOE website. I assumed that was the most reliable.

As for your timing advice, thanks. The notion of buying the option back on down days, particularly one as sharply down as yesterday, makes sense. I'm doing that. But your advice to wait for an upday to sell again is confusing. The source of my confusion is as follows.

I'm assuming the best time to write ccs is either in a non-trending market (going sideways) or in a slightly down market (for ccs written against stock one owns). Sound right? If that's the case, then writting them on the slight upticks in a downtrending or sideways market looks like a difficult trick. I can't work the tape quite that well yet. Any hints as to just how to do that.

Thanks again for the help,

John
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