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Strategies & Market Trends : The Covered Calls for Dummies Thread
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To: Dan Duchardt who wrote (3375)2/8/2002 7:27:07 PM
From: DiB  Read Replies (1) of 5205
 
Dan,
thanks for your answer. I've got several questions:

I) Under what circumstances will you buy puts before Feb expiration? If the answer is "no, I'll wait to see if I'm called out", then assuming you're not called out, when exactly will you buy puts? Will it be after you sell Mar 35 or Apr 30 calls? or may be after that and when MU's price hits a certain point?

II) Please correct me if I misunderstood you...
I understood, that if you feel that MU will run up to 40 or already is around or above 40, then you will:

1) sell Mar 35 calls
2) buy Mar 40 puts

and if MU starts tanking, then you will:

1) sell Apr 30 calls
2) buy Apr 30 puts

How do remaining time till expiration of those new calls and the put's price factor in your decision making? How much of a gain percentage-wise are you willing to spend on puts?

Thanks a lot for your help,

-DiB@timingiseverything.put
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