Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Non-Tech : The Critical Investing Workshop -- Ignore unavailable to you. Want to Upgrade?

To: Jill who wrote (29350)	8/17/2000 7:41:49 PM
From: ZOOB	Read Replies (2) \| Respond to of 35685

Hi Jill: Any thoughts on GSTRF....02's @7.5(VVYAU) going for 4.75 and 03's @7.5(WBCAU) going for 4. Leverage almost double.......should know in a year what will happen.....potenially explosive growth (6X). Thanks in advance.

To: Jill who wrote (29350)	8/17/2000 7:44:10 PM
From: nolimitz	Read Replies (2) \| Respond to of 35685

Jill Thanks for the info and what is probably a dumb question or two. 1. When you say buy-write do you mean buy long and write CC? 2. I have some very good co. options (way in the money) Stock is currently at 90ish. Would I excise and write @ or near OTM calls? It is very voltile stk. TIA nolimitz

To: Jill who wrote (29350)	8/17/2000 8:07:56 PM
From: pinhi	Respond to of 35685

Jill, could you splain alittle more about the stock dropping to 25 and you roll out? You said buy the calls back at a higher price, don't you mean lower price if the stock has fallen? The do you mean you roll out to a higher strike price say maybe 3, 4, 5, months out to get more premium? That would also mean that for that time period you have no options premium to spend for income on that portion of you vehicle. All this assumes that you are spending 100% of the options premium to live off of. Could you give an example of how this might work? many thanks in advance, Pinhi

To: Jill who wrote (29350)	8/17/2000 8:35:26 PM
From: RocketMan	Read Replies (2) \| Respond to of 35685

So you had elon at 35 now suddenly its 25. So you say, okay, I'll buy-write at 25, it's percentage income I'm after and that remains good. But then that month, it RECOVERS and you get called out at 25. Now all you have is 25. Wouldn't that problem not arise if you buy-write right away? If you buy at 35 and write at or near that right away, if it goes to 25 you pocket the premium and write again the next month, though for a lower premium. I agree that if you buy at 35 and it drops substantially, then you write, you are at risk of having it called at a much lower price, and you have a net loss. So the strategy should be to buy-write at the same time. Right?