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Technology Stocks : Qualcomm Incorporated (QCOM) -- Ignore unavailable to you. Want to Upgrade?

To: Voltaire who wrote (46600)	10/30/1999 2:44:00 PM
From: James C. Mc Gowan	Read Replies (1) \| Respond to of 152472

Good Morning Voltaire; first, thank you for your generous sharing of your experience and knowledge. Your analysis of otherwise difficult to fathom short term movements in Q/Market has helped me greatly, and avoided earlier tendencies to succumb to manipulation. You posted this AM your pre-earnings covered call strategy; I was patting myself on the back, having mentioned that this was the best way to deal with the uncertainty of pre-EPS, post EPS release, to my wife yesterday PM. Would you indulge me with more detail on your covered call strategy? I looked up the NOV Q options and here is my take; November is best because it takes us past the Fed meeting on the 17th, with whatever manipulations may be attached to that event, beyond the significance of the Feds decision on rates, itself. It also provides the most premium to sell for the shortest time frame; If JW's TA read is on the money(and he has been prescient of late, no?); then we may be looking at a common price of 225-235 by Monday or Tuesday before closing. You suggest selling in the money calls; I was thinking the Nov 220(AAOKD) which are now offered at about $15.00/Contract, would be a nice balance btw collecting a hefty premium for the risk of getting called away, in the event that Q blows away estimates; announces they now rule the known world, whatever, or, conversely, the "sell the news" phenomenon, with reasonably robust earnings and no earth-shaking pronouncements now. If JW's more optimistic read has us up to say, 230, on Monday, or Tuesday, the Nov 220 should selling for about $19. to $21./contract. If Q holds steady in low 220's, still a good sell at $15., no? I am thinking that the best case post EPS may be $240, on great news, so the Nov 220, sold at about $20. would equal that potential, while shielding common from the risk of post EPS selloff. Please forgive my ramblings, I am new at this game. I did, however, play your Jan200's 2 different times in recent weeks from approx. $20. to $40, buy to sell. Last one done from 10/18/buy to 10/22/sell; did this in Maui in a phone booth; 2 mornings, 15 minutes work Monday and Friday; made enough on this buy/sell to pay for 5 Maui vacations, hee, hee. Is this a great country, or what! If I am on the right track, a simple yea or nay would suffice; I don't want to be presumptive of your time. Thank you, James EDIT: Oops, I meant to send this as a PM; well, maybe a response will be helpful to others; if I am way off, I willingly sacrifice my ego to the greater good of the thread.

To: Voltaire who wrote (46600)	10/31/1999 11:33:00 AM
From: gdichaz	Read Replies (2) \| Respond to of 152472

Voltaire: I posted the following in Uncle Frank's G&K thread because he raised the question there whether he should "time" the Q's stock around earnings. In my post I attempted to outline what I understood your call writing insurance policy to be. But I may not have been accurate. And you speak for yourself much better than I can reflect your views. So is my characterization of your approach accurate? Do you have any further comments on your call writing strategy? Thanks in advance. Chaz (Cha2 on the G&K thread) The post on G&K: Talk : Market Trends : Gorilla and King Portfolio candidates To: Uncle Frank (9273 ) From: gdichaz Sunday, Oct 31 1999 10:57AM ET Reply # of 9287 Uncle Frank: As you know in response to your question on whether you should try to time the Q's short term price movements, my suggestion was - don't. That was on the assumption that you were considering selling the stock and then trying to time buying it back. For that my suggestion is still - don't - because the timing of the buyback is so difficult and the stock may have run away from you. And you would have substantial short term capital gains on which taxes must be paid at the ordinary income rate, while waiting permits the lower long term capital gain rate. In brief the game ain't worth the candle. BUT in thinking about Voltaire's approach which he outlined on the Q thread, he is trying to avoid timing a sale of stock, he is talking about keeping all the Q stock and buying an insurance policy on it by writing (selling) in the money calls. This is a horse of a different color. Insurance not timing. It is a sleep at night strategy. A little complicated and needs careful execution on the writing and buying back of the calls themselves, but the stock is untouched. Do I understand Voltaire's approach correctly - and if so - isn't it an even more conservative, i.e. modifying the Gorilla Game strategy by taking out insurance so to speak, (taking some license or interpretation of it) than simply holding the stock naked through earnings. Comments welcome, particularly on: First, is my reading of Voltaire's strategy correct? Second, is this approach wise? Third, is it consistent or inconsistent with GG principles? Best as always. Cha2