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Strategies & Market Trends : The Covered Calls for Dummies Thread
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To: Dan Duchardt who wrote (3424)2/26/2002 5:13:01 PM
From: andydaoust  Read Replies (3) of 5205
 
Dan,

I still can't find answers to: "selling qualified covered calls that are in the money suspends holding period for underlying stock". Does anyone know what that means if you are assigned? Will it be long-term if the stock was long-term prior to selling the ITM call? That is the way I read it. So if you owned a stock for six months and sell a qualified ITM covered call, and are assigned 9 months later then the holding period would be effectively six months and not 18 months. Is that right? If a covered call is not qualified what does that mean? They are considered two separate transactions?

Thanks,

Andy D
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