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Strategies & Market Trends : Options for Newbies -(Help Me Obi-Wan-Kenobe) -- Ignore unavailable to you. Want to Upgrade?

To: Mauricio Breternitz who wrote (1469)	6/25/1999 10:03:00 PM
From: Jon Tara	Read Replies (1) \| Respond to of 2241

Mauricio, you will some considerable cash in your account to write naked calls. Preferred wants $25,000. Most brokers want $100,000. You won't be able to write options against your options, by depositing them somewhere, etc. Because they AREN'T shares, but options, they can't possibly "cover" the calls you want to write. IF you could do this, the best you could do is a spread transaction, which would have lower margin and initial cash requirements than naked calls. But you still couldn't do it, because these aren't exchange-traded options.