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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 (6307)1/6/1998 8:03:00 AM
From: GROUND ZERO™  Read Replies (1) of 14162
 
Hi Herm,

I discovered your thread about a week ago and have been reading the posts with interest. I understand the concept of writing CC and that you should only execute this procedure if you like the stock to begin with. I have three question which I need to ask.

1) If you like the stock to begin with, why abbreviate profit potential with a CC?

2) I notice that the further out in time you go, the greater the premium on that call. If I were to execute a CC, how far out is the optimal time period recommended, or does and should the selection vary?

3) Is just at or out of the money the best choice?

Thanks in advance for your comments.

Happy trading.

GZ
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