SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Strategies & Market Trends : How To Write Covered Calls - An Ongoing Real Case Study!
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: Zach E. who wrote (6309)1/6/1998 8:14:00 AM
From: Herm  Read Replies (2) of 14162
 
Hi Zach,

I'm glad you took the time to point out the benefits of the strategy. I have successfully employed it several times myself and that is why I mentioned it just recently to another reader.

I first learned about this technique at a free workshop offered by The Chicago Board of Options Exchange (CBOE) cboe.com when they came to Florida. Click on the CBOE and check out the education section. I HIGHLY RECOMMEND everybody attend their FREE workshops which includes free software and workbook/study manuals! It does not matter how novice or expert you are. They divide the groups into beginners and experts. And, let me tell you their expert work sessions will round circles around Wade Cooke and company! :-)

Anyway, you are right about this strategy given the conditions you carefully have considered. It would work very well. They referred to this strategy in their handout, "Options Concepts and Strategies - Tools for Risk Management," on page 27 as Stock Repair Overlay. What freaked me out was that it varies from a normal bull spread because there is no debit (the difference in out of pocket expense) to you and downside other than the normal stock price fluctuations. Yet, it has the tendency to tweak a profit as you approach those expirations dates where the stock prices tend to move4 towards a particular strike price or during expected good earnings release dates. And finally, it allows you to be called out at a higher strike price anyway! So, for as an entry into a new stock position for CCing it may be the way to go.

Thanks for your input! Anymore opions out there!
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2025 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News