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

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Strategies & Market Trends : How To Write Covered Calls - An Ongoing Real Case Study!

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To: jw who wrote (9079)	11/18/1998 7:58:00 AM
From: Herm	Read Replies (4) of 14162

JW, I would only add to your "tool shed" shorting the stock at times rather than selling a call. When would that be better? At times there may be a very light open interest in the call and put options. If the stock tags that upper BB and RSI peaks and the stock is reversing, then it would be better to short against the box by picking up an equal number of shares short. Net effect! Neutral to lock in your profits at that point. Plus, it is easier to split hairs in getting a better price (profit) working with the stock than the CALLs and PUTs. Moreover, the commissions are lower. For those just starting out and don't have enough dollars it may be the way to overcome the commission bite. Also, if your broker considers option spreads as naked or will not allow a Call spread against a LEAP I would find another brokerage to do your options trading. It is much too profitable to tolerate a light weight stock brokerage dealing with equity stock trading only. Thanks for you interest! Let us know how you are doing!

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