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Strategies & Market Trends : The Covered Calls for Dummies Thread

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To: Bridge Player who wrote (4456)9/28/2006 9:53:50 PM
From: alanrs   of 5205
 
Today I did a buy/write on NRPH, a drug development company with a ruling from the FDA due out Oct. 6. Bought at $25.16, sold the Oct. 22.50 call for $6.10. Somewhere around 18% if called away in 22 days. Large open interest in the Oct 30 call.

I also now own an additional 1300 shares of QCOM at around $39 due to writing a number of puts ranging from $35 to $42.50 a few months back. Way overweight in QCOM. I've written naked (cash covered) puts against Joy Global, Nucor, Chicos FAS, Cree, Qcom, Network Appliance, Intuitive Surgical, Evergreen Solar, Northfield Labs, maybe a few others I don't remember in the last 6 months.

Some expired or where bought back, some got put to me, some subsequently got called away quickly, some I still own. With covered calls it's easy to calculate my success rate immediately, while with puts I often end up holding the stock while it's underwater for a while, so the final tally is harder to figure.

ARS
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