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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: Netwit who wrote (11416)	8/24/1999 6:01:00 PM
From: Herm	Read Replies (2) \| Respond to of 14162

Herm: if you write deep in the money calls aren't you essentially protecting your downside to the extent they are in the money--e.g. isn't the in the money portion reflected in an increased premium? That is correct Netwit! By selling CCs when a stock peaks and reverses for a normal downward cycle and you grab as much CC premies, you are hedging and protecting the downside for as much as the CC money collected. CC @ $3 means $3 of drop before it starts biting into your wallet. It sure makes me feel better when I know the CCer is getting killed. If I breakeven, I'm relieved my capital is still intacted and I'm going to be around to make money. I don't lose sleep watching my money in the stock market anymore. I have damage control tools and leverage tools for turkey shoots. I read the powerpoint presentation. What a wonderfully simple way of presenting complex information. Thank-you. Here's another question. If you want to sell a stock--say AT&T--anyway. Why not write a covered call or even a deep in the money covered call--if you get called out great, if you don't collect another premium? Sure, I just did that with BTGC when I forced myself to be called out. In the meantime, I used the CCs money to buy more shares in other stocks I was holding. I like to average down and buy more stock using the CC dollars. That way, I get to write more CCs and repeat the process over and over until I get to 1,000 shares. I usually exit after that and start all over again. Another possibility is to write ITM PUTs right before a lower BB tag in order to have the stock PUT to you at a discount when you deduct the PUT premies. You get to add more stock when you want to be long cheaper that way! By the way, I am working on the WINs Interactive CD which will be sold for a small fee. It will involve learning WINs and being able to read the charts for yourself. So, you get practice over and over until you fully understand what you are doing. Some folks require more technical support. webbindustries.com