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Technology Stocks : Dell Technologies Inc.
DELL 136.46+1.9%11:44 AM EST
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To: Geoff Nunn who wrote (81893)11/23/1998 11:28:00 AM
From: Chuzzlewit  Read Replies (1) of 176387
 
** OT **

Geoff, the devil is in the details. You have assumed equal risk across all options, but I believe that the writer of an option has less risk than the buyer of an option, and that for covered calls, the writer of an in the money option has less risk than an out of the money option writer. Depending upon how deeply in the money the option is written, the risk of the in the money covered call writer is an opportunity cost. Now, in writing out of the money calls the risk is mainly the drop in the price of the underlying stock.

I guess what I'm getting at is that before we can have any meaningful debate we need to better define what kind of options we are talking about. I personally like writing out of the money covered calls.

TTFN,
CTC
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