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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: Casaubon who wrote (12245)	1/24/2000 11:36:00 PM
From: jebj	Read Replies (2) \| Respond to of 14162

>If your long LEAPS get called away, you lose a lot of money in time value. - Casaubon I assume you are talking about using short term options against the LEAPS in which case you are certainly correct. However it seems to me that Roth makes a very good case that using LEAPS in every single case is better than what we consider "normal" options plays. In other works, why use the shorter term options against the LEAPS when you can use LEAPS themselves? jb

To: Casaubon who wrote (12245)	1/25/2000 2:14:00 AM
From: NateC	Read Replies (1) \| Respond to of 14162

Actually neither of my two brokerages (Ameritrade, and Dreyfus) would call the Long LEAPS away. (and you are right....that would hurt...because I would lose all the time premium in them) They call you and let you know that you are assigned....meaning that you have sold short the shares at the short CC's strike price. You can cover it any number of ways....and exercising the long LEAPS call would not be a wise choice

To: Casaubon who wrote (12245)	1/25/2000 2:17:00 AM
From: NateC	Read Replies (1) \| Respond to of 14162

You are also absolutely right aboutmonitoring these positions. Next time...if I'm even CLOSE....I will close the CC position and roll out....remainingin control. In this situation....I watched a realtime streamer AND a realtime chart the last hour on friday....to be sure that the underlying SCH did not trade at the assignment level (3/4 point above the strike price of 37 1/2) Seeing the exchange close, with the closing price at 37 7/16.....I went to lunch, and thought I was OK. the afterhours trading is when it went to 38 1/2....and i had no way to monitor that. (actually Datek's streamer will allow you.....you have to hit control-I....and it takes you to Island afterhours quotes.)...but I didn't think of that