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Strategies & Market Trends : Technical Analysis - Beginners

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To: jebj who wrote (8827)	10/23/1998 12:59:00 PM
From: Tom Halkar	Read Replies (2) of 12039

jb <<Tks for the info - again. Understand how covered calls work - but you have your money tied up in the stock when you do so. Could you not run a straddle and be somewhat protected with only a fraction of what it would cost to run covered?>> Yes you own the stock, however, if you buy into a losing position you can cut your losses. When you have a covered call, broker will want you to closed your position on that too. Don't know about Straddle concept. <<Why would this not be the best use of funds?>> Correction, if you know yourself and TA very good you can venture into this game, but I wouldn't. It, is my opinion that the market is controlled by the big money like mutual funds and they will start turning over there bad position soon. I would not want to be in one of those stocks that the MF decided to dump with a covered call. <<Also, why not run a covered straddle if you are going to cover?>> Here an opportunity to teach me something. Give me an example of how this works and the benefits. Tom The Windy City

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