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Strategies & Market Trends : The Covered Calls for Dummies Thread
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To: Carl Worth who wrote (4732)2/20/2007 6:32:06 AM
From: Jerome  Read Replies (1) of 5205
 
>>>if an investor is bullish on a company, and they turn out to be right, they would make more money by being long the stock than by being long and writing calls <<<

Here is where we differ in opinion. You can be very bullish on a stock and it may have all the positive signs desired by investors, (good earning, outlook, management, analysts upgrades, etc. ) and it may still go nowhere. So a covered call generates income while waiting for appreciation in share price.

I only write covered calls on stocks that I'm bullish on. Otherwise you wind up with a handful of stocks like AMD. I have a small position that I used for covered calls for two months at the 20 strike and now my shares are at 14.

JMO....Jerome
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