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Strategies & Market Trends : Canadian Options -- Ignore unavailable to you. Want to Upgrade?

To: Vectra who wrote (1407)	7/5/1999 6:41:00 PM
From: Nevyn	Read Replies (1) \| Respond to of 1598

Ok, here's a question: How do you use options as a part of your investment strategy? I have bought calls and sold covered calls.

To: Vectra who wrote (1407)	9/13/1999 9:13:00 PM
From: csm	Read Replies (1) \| Respond to of 1598

Options lab. I have been using options more often recently and have a Q about a particular position. I bought PD around $17. It moved up to 30 and then fell back to 28 or so. I sold some Oct 30 Calls for an average of $2.40. Meanwhile, PD has taken off again. Hit $40 today. I thought I'd be happy with $32.40 but am having second thoughts, duh. Seems to me that I should roll out and up and try to buy back the 30s (let's say for $10) and sell some Jan 40 calls (lets say for 4.50). That gives me a debit of 5.50 on that spread and about 3.10 net. With PD above $40 in Jan, I get almost $36.90 instead of $32.40. With PD below $40 in Jan I get to hold the stock for $3 less than its market value, and I'm ahead as long as it's above $35. Any comments? And any suggestions about a good options book with practical strategies, I could use one. Thanks. Stuart.