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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: jaytee who wrote (11498)	9/6/1999 10:12:00 PM
From: backman	Read Replies (2) \| Respond to of 14162

RMBS...about 3 weeks ago, i purchased RMBS (on margin) at about $85...at that time, RSI was about 40, and it was touching lower BB....sold sept 85 calls for $8, almost 10% ROI IMCL...similar time frame, purchased at 25, and sold calls for 2 3/8...similar technicals to RMBS ignoring the fact that the both stocks have had a considerable runup, is the correct procedure for this methodology to buy the stock, and not sell the call until the upper BB/RSI>80, situation occurs? is there a minimum pct return for selling the call, below which this method isnt appropriate? ideal time frame for writing the call? ie one could increase the ROI for the call premium by collecting interest premium for many months, but might not be worth being tied up with a stock for many months I've recently acquired IBM at 125, and will look forward to learning how to best use this position all opinions welcome thanks david