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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: Richard Gibbons who wrote (11903)	11/26/1999 9:34:00 AM
From: Herm	Read Replies (2) \| Respond to of 14162

Hi Richard, Welcome to the forum! You presented a very sharp and astute assessment of what is mathematically is taking place here. (It also means that, in a market that's way above any historical valuation ever, many of the people here are making money by shorting puts. What fun! :) I usually skip the covered call part though, and just sell a cash-secured put, and only do it with stocks that I believe are way undervalued.) It's not that WINs advocates going after declining stocks to simply write CCs. Rather, the CCing is part of a bigger long term process of investing as the CCs provide you with downside protection against capital depreciation. Yes, without sideshows long PUTs, the position is neutral as you indicated. That is ok. Typically, most folks panic and lose oney at that point. They have no idea of what to expect since they don't use technical indicators. It's all emotional and subjective decisions. You see, we are presenting a conservative total approach for the novice to average investor. The money you protect as the stock cycles downward is used to perhaps buy long PUTs or to buy more stock to average down and repeat the process. To make this all possible, we provided technical chart indicators to assist with the timing of the CC writes, entry into the stock, and exit. In short, I don't know of any website other (than this forum) out there that offers a total package of what to do, how to, and why. Do you? We would like to tap your brain as well. :-)

To: Richard Gibbons who wrote (11903)	11/26/1999 10:35:00 AM
From: Ken Adams	Read Replies (1) \| Respond to of 14162

Richard, All good math! My interest in CCs is divided between my IRA account and my trading account. The IRA, of course, will permit CCs but will not allow puts. I view it as a relatively conservative way to increase the IRA beyond simple buy and hold. The trading account is another matter, as I use puts and calls there, but do very little CCing. My trades are just that, trades with holds of very short duration. Whatever works! Ken