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Strategies & Market Trends : The Covered Calls for Dummies Thread
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To: JGoren who wrote (1545)7/20/2001 12:05:34 AM
From: cfoe  Read Replies (1) of 5205
 
Or is it just the October calls, which are sold before the end of September, that are at risk?


John - That's a good question. If you think about it, all QCOM options now cover both Q-classic and Spinco, combined. So it would seem any unexpired option written before the spin-off and still outstanding after the spinoff covers both entities.

If the spin happens at the end of AUGUST, then the September and later CCs would be at risk. If it happens at the end of September, the risk would begin with October CCs.

If you are concerned about the T/AWE scenario, I would suggest not writing any CCs until after next week's call, when I would assume they will be asked about the spinoff.
Seems to me to be the safest bet.
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