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Strategies & Market Trends : How To Write Covered Calls - An Ongoing Real Case Study!
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To: Dan Duchardt who wrote (10371)4/14/1999 7:30:00 PM
From: NateC  Read Replies (1) of 14162
 
I bought 1000
CYCH at 19 3/16 (too soon, but Oh well- I was expecting support at 19+ based
on earlier in the day lows) and as fast as I could sold 5 May20 calls for 2 11/16
and 5 June22 1/2 at 2 5/8. So I had two 500 share lots with NUTs of 16 1/2 for
the Mays and 16 9/16 for the Junes. The upside potential on these were 21% for
May and 35% for June (no margin). Looked attractive to me!

Then the afternoon sell off set in, and I got interested in further protecting my
downside. Without the benefit of time to crunch the numbers, while CYCH was
dancing around 17, I bought the May20 for 1 7/8, bought the June22 1/2 for 2 1/8,
sold the June17 1/2 for 2 9/16, and sold the Jun20 for 2 11/16, reducing my NUTs
to 15 13/16 and 16 for June. Of course, I gave up a LOT of upside potential (that
didn't look likely to be realized at the time), but still it's 10% for May and 25% for
June (no margin).
Wow...Dan...this is a lot of trading for me to keep up with.
so you bought back your CC's at a profit....and then rolled down selling June 17.5 and June 20 right? You look pretty well protected with the NUTs (didn't check your math).....so it looks quite good.
don't know this underlying very well? got any money for a June protective put as well??
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