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Biotech / Medical : Biotech Valuation
CRSP 56.98+1.1%3:59 PM EST
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To: Cary Salsberg who wrote (5139)12/14/2001 1:17:19 PM
From: tuck  Read Replies (1) of 52153
 
This is ancient history, but an excellent thread called "How to Write Covered Calls: An Ongoing Real Case Study," covered VVUS for some time. Step into the Way Back Machine:

Message 1600229

I have been doing this for some time. In general, though, my strategy has been to write ITM calls on core holdings that have had runups. Calling tops (and bottoms for buybacks) is difficult, and it's easy to get whipsawed. That's why you collect the big premium bucks on biotechs. Overall, I would say that this strategy has made me a little extra cash, and protected me from some catastrophes a little better than just being long the stock. Oh, and I always use spreads to roll options, to avoid execution risk (i.e. the stock moves down before you can get the order in to write a fresh batch after you bought back a batch close to expiration).

Cheers, Tuck
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