How To Write Covered Calls - An Ongoing Real Case Study! Message Board

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

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To: Herm who wrote (5918)	11/20/1997 7:49:00 PM
From: Jess Beltz	Read Replies (1) of 14162

Herm, I have no experience with technical analysis, and need a quick primer on the use of Bollinger Bands and Relative Strength Indicese. I do not ask you to provide this information. It would be sufficient for you to point me in the right direction. I will do the research on my own. Thanks in advance, and I will be in touch. PS - the strategy I had in mind was to look for stocks pulling steadily upward (trendwise, keeping volatility in mind), and write close to the money (but out of the money) calls and try and get both a modest premium and some capital gains apreciation. PPS - Suppose that a stock has had a significant price run up, and there are a lot of ITM calls outstanding as we approach an expiration Friday. Does such a situation imply a further price runup as the writers of the ITM calls have to start covering their positions and begin purchasing the stock? IE, can they simply settle cash out, or do they have to purchase the stock, putting further upward momentum on the share price? jb

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