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Strategies & Market Trends : The Covered Calls for Dummies Thread

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To: Tom Chwojko-Frank who wrote (1106)	6/20/2001 12:31:20 PM
From: FaultLine	Read Replies (1) of 5205

Any opinions on a buy/write of RMBS? The numbers have changed substantially. the quote is at 9.10 and the 7.50 strike is now selling at 2.05. Since the intrinsic value is 1.60 your time premium under these circumstances is only 45 cents. If you are called, you went in with 9.10 and come out with 9.55 -- about 5% for 4 weeks. Not bad but not great either. Downside protection is also about 5% which is a little skimpy IMO. Keep us posted. -dfl

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