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Strategies & Market Trends : How To Write Covered Calls - An Ongoing Real Case Study! -- Ignore unavailable to you. Want to Upgrade?

To: Herm who wrote (11334)	8/3/1999 5:36:00 PM
From: Cedric Wynn	Read Replies (2) \| Respond to of 14162

Would it be best to purchase the Jan 2000 5 Leap Call(s) or the Jan 2001 5 Leap call(s) on the bounce?

To: Herm who wrote (11334)	8/9/1999 10:33:00 PM
From: George Cowsar	Read Replies (1) \| Respond to of 14162

IFMX case study: on Mar 21 IFMX was at 7 15/16 Herm wrote: [begin quote] I happen to own 500 shares of IFMX which I picked up when the stock was at $5.00. It had a nice gap up to $13. I sold five 7.5s IFMX LEAPs JAN01. I plan to cover soon and milk $$ IFMX another round. I may buy more. IFMX has hit a price support level. It should hold at current levels. An entry into IFMX might look like this: Buy IFMX 5s JAN01 @$4.5. Wait for a price increase to $9.50 plus and then write CCs for say the 10s AUG. @ 1 5/8s. You net cost is $5 LEAP strike + $4.5 =$9.5 before the CCs. The CC premie of 1 5/8s = 36.11% unmargined. [end quote] After Mar 21 IFMX went down and then oscillated between about 6.5 and 7.75 with a high of 8 3/8 on 4/14 and then finally moved up to a high of 9 7/16 on July 16. It never quite got to 9.5. My question is what did you do during that time? or if you had entered at that time (as opposed to your situation being already in the stock) as you suggested getting in with Jan01 leaps, what would you have done during those 4 months considering the stock didn't make it to the target? BTW - I've struggled to barely not quite break even over the last 2 months. I made a number of mistakes but considering the drop in the market and my stock picks all dropped more than the market, I'm glad I was hedged otherwise I would not have done so "well". Disappointing... I was up about 10% around July 4, and now down about 2%. I'm completely out. Next time around I intend to go by the book, if I stick with CCs that would be the WINs book. I'm also considering the CANSLIM methodology. Maybe some of both. thanks, george