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To: Mannie who wrote (7760)	3/16/2000 10:53:00 AM
From: Jeffry K. Smith	Respond to of 35685

Scott, you have the concept exactly right, except for one important caveat (which may not apply to your situation) - and that is that if you buy too much on margin and the stock drops precipitously (sp?), you may get a margin call. Be willing to be stuck with whatever you buy, of course, if the picture turns bad, with the possibility that you may get little or nothing (in the form of option premiums) while you wait for things to improve. Otherwise, that's one of the games I and others play! Best, Jeff Smith

To: Mannie who wrote (7760)	3/16/2000 11:03:00 AM
From: candide-	Read Replies (3) \| Respond to of 35685

Hi Scott, you almost have it. Here's my two cents worth. You never have to get called out; all you have to do is buy back the CCs. For instance, I sold the March 130 CCs on 1500 of my Q. Let's just say at the close tomorrow Q is at $135. I do not want to risk being called, so this morning I bought back the $130 CCs for $2 each. I sold them for about $5 a week ago, so I netted $3 each. If the stock price were higher, it would have cost me more, but I would have still realized about 1/3 of the stocks appreciation since the call price would have been less than the delta between the strike price and the price to buy the stock. i.e. If the stock was at 135 then 135-130=5 vs. an option price of maybe $4 tomorrow. One other thing, the cost basis of the stock does not matter. You should write CCs on shares you have realizing you do not have to get called out. You can use margin to buy back if you need to. Sometimes you win, sometimes you win more! That's my two cents worth, C-