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Strategies & Market Trends : How To Write Covered Calls - An Ongoing Real Case Study!

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To: Douglas Webb who wrote (4142)8/25/1997 9:41:00 PM
From: Herm   of 14162
 
Another possibility would be to tap the margin combined with your remaining cash to pick up as much stock and not exceed say 50% equity to margin. That gives you a 20% downside margin of safety before a possible margin call. I usually work at 40% equity - 60% margin. And, I can control a 3% drop before I counter move to correct the balance. As my portfolio moves into a 50% equity - 50% margin I buy more stock write more CCs or dip into the treasure chest and withdraw some extra spending money!
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