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Strategies & Market Trends : The Covered Calls for Dummies Thread

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To: shlurker who wrote (5186)12/2/2011 4:04:11 PM
From: pekos  Read Replies (1) of 5205
 
AAPL has been around 382.xx On Friday, 11-nov-2011:10:00AM
If you think AAPL goes down, you should have bought a put, not a call.
Buying a Call -> betting stock goes up
Buying a put -> betting stock goes down

For some education on optíons look at cboe.com

If you sold a covered call you probably bought the Stock at 382.00
sold the Nov 350 call @ 37.80

calculation: 382.00 stock price
- 350.00 call strike
= 32.00 instrinsic value
you got 37.80
- 32.00
= 5.80 time premium
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