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

STOCKTALK

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 Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

To: Ken Hawn who wrote (7839)	7/7/1998 9:23:00 AM
From: Herm	Read Replies (1) of 14162

Hi Ken, You are wise to read and question everything you read on the internet and message boards. Your question of what I advocate when the stock price tops out in the upper BB and RSI was stated correctly but I believe you misunderstood the sequence of events. You are correct personally I tend to enter a stock when it is beaten up and ready for a turnaround. I've had my best rewards with those kinds of stocks CCing. Reason? More upside or sideways movements to rack up the CC premies along with capital appreciation and peace of mind. Reader are always asking about their stocks. Therefore, I look at the chart, news,and earnings date and make suggestions. Those are not my picks per say. People who read this forum may already own and are long on the stock(s). In that case, the technical indicators BB and RSI should be closely reviewed for clues when to CC their stocks. The patterns vary somewhat from stock to stock but the concepts remain the same. When a stock peaks out (upper BB reached and strong RSI 70+) the selling and profit taking will begin. Therefore, why not capture as much premies by CCing at or in the money at that point? Better yet, why not load up on some cheap PUTs and turbo charge the pullback? As the stock cycles downward your CC buyer's premies will erode and you will keep the majority of the premies before you cover. Now, did 80% of my personal recommendations (as examples) in August meet the above criteria? Most likely not! I'm working on the flip side of CCing process of what you should do when the stock is turning a corner and beginning the upward reversal. Do you see the whole picture better now? Thanks for your question Ken!

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next