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Strategies & Market Trends : How To Write Covered Calls - An Ongoing Real Case Study!
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To: hpeace who wrote (979)3/14/1997 7:29:00 PM
From: Mark   of 14162
 
Subject: E*Trade Help

Greetings,
All of you participating in this thread have given me tons of information and have pointed me towards lots of great learning resources.

I'd be interested in your advice on the following:

On 3/5, I purchased 2 contracts of E*Trade (EGRP) at 25-3/8, and wrote the April 30 calls. The technicals looked great, the fundamentals were fine and the news was good (new contracts with Microsoft and others). My broker liked it, and claims to still be doing heavy trading in it.

Since then the stock has dropped repeatedly (except for 3/7), and now sits at 20-7/8.

I can find no new bad news whatsoever to account for this decline. He claims that it's a "short term pulback", possibly related to the highly touted IPO of Accutrade. His recommendations are as follows:

My April 30 expiration is still a long way off. My broker suggests continuing to hold the stock. As the expiration gets closer,if the stock does not regain lost ground, then he suggests perhaps buying back the calls, and writing lower calls.

My fear of course, is that the stock will continue to plummet.

I'd be very interested in hearing your constructive thoughts and suggestions...

Thanks in advance!

Best regards,
Mark
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