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Politics : Ask Michael Burke

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To: Knighty Tin who wrote (28265)5/18/1998 6:53:00 PM
From: Zach E.  Read Replies (1) of 132070
 

Mike,

You wrote (paraphrasing) that one of the options threads about
covered calls on SI was not only wrong but dangerous. I assume
that you're referring to the "How to write covered calls" thread,
which I've been following for a while. I'm not currently employing
covered calls, but I think that it does have a place, as long as
one isn't just surfing for premiums, as is often emphasized on that
thread. I understand that the expected return is not as high as
plain stock ownership, but the chance of profit is greater. When the
implied volatility is high (depending on the reason of course),
writing covered calls or cash-backed puts seems attractive to me.

Regards,
Zach
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