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Strategies & Market Trends : Calls and Puts for Income
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To: kaka who wrote (3192)10/15/2008 4:41:51 PM
From: Bridge Player  Read Replies (1) of 5891
 
Buy +10 covered GM Nov 7 call/GM @ 5.30

When you post stuff like this it drives me crazy.

You didn't "Buy +10 covered GM Nov 7 call"

You SOLD calls. Since you owned an equivalent number of shares of GM, the calls that you sold were thus "covered". If you didn't own the stock, the calls you SOLD would have been "naked".

To recap:

You BOUGHT stock.
You SOLD calls.
You SOLD puts.

You are now LONG stock.
You are now SHORT calls.
You are now SHORT puts.

This game is hard enough without confusion over terminology.
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