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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: Tom K. who wrote (12108)	12/24/1999 12:58:00 PM
From: OX	Read Replies (1) \| Respond to of 14162

Herm and others... re: I would imagine if the same stock is PUT to you twice with the tax time span and PUT strike, that would be considered a wash sale? Are there any other traps? apologies if this is part is obvious, but getting the stock put to you is just like buying it (except you basis is lowered by the prem rec'd). The one "trap" I can think of w/ NP is that Puts will lose time value quicker than Calls when get go ITM (and conversely will lose time value less when OTM)--it has to do w/ carrying costs (see McMillan). So this means DITM Puts are more likely to trade w/ negative time value, as opposed to Calls which will rarely do so. If this happens, you are more likely to be assigned early (on American style options of course). So you have to be ready to repair if DITM and you don't want the underlying put to you. --- Tom, Excellent strategy w/ NP selling. I do almost exactly the same thing, w/ almost exactly the same overall philosophy. It fits a certain style of trading/investing.