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

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To: stoploss who wrote (9941)	3/14/1999 5:20:00 PM
From: Herm	Read Replies (1) of 14162

Good questions about CHRZ Don! I set the chart to read 120 weeks and it shows a two year profile. CHRZ broke below that $19-$20 price support level sending CHRZ price back to 1996/97 price levels. You really cushioned your downside writing that nice CC and picking up an easy $3.00 of free insurance. Now, notice! Had you picked up CHRZ PUTs you would have made some profits! But, that is an optional sideshow when using WINs. Short Interest for CHRZ is .7% of the shares outstanding, requiring 1 days to cover. So, CHRZ is starting to slow down it's price drop. I suspect CHRZ will hit $8.00 before it flat lines and starts to recover. Two reasons? The MMs and Funds have the fear in their favor and are shaking out the weak hands that are dumping fast! Those people don't use WINs tactics to save their beacon. They fold before they lose money. From a technical standpoint, I have noticed that stocks that break $10.00 seem to go further down. Maybe it's it is why more people short more shares as they get cheaper! But, the chart does show an RSI that is about to level off and perhaps show signs of recovery. iqc.com NASDAQ: (CHRZ : $11 3/4) $318 million Market Cap at March 12, 1999 Trades at a 83% Discount PE Multiple of 7.5 X, vs. the 43.1 X average multiple at which the Software & Services SubIndustry is priced. CHRZ is a bargain with a 28% growth rate and a cheap 7.5 P/E. This stock took a heck of a beating! You still have some value left in the Sept. 17.5 CC which is @ 1 1/4 at this point. You should cover when it falls below 7/8s and perhaps roll down to a second round of CC with CHRZ Sept. 12 1/2 @ 2 1/2s to 2 5/8s. ANIK? Someone should shoot that stock and put it out of it's pain! The stock is below $5.00 so no margin purchases and open interest dead, dead, dead. Stay away from it! Otherwise, if you own it! Hummm, seems like dead money to me!

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