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Technology Stocks : All About Sun Microsystems -- Ignore unavailable to you. Want to Upgrade?

To: X Y Zebra who wrote (37664)	11/12/2000 8:41:49 PM
From: rudedog	Read Replies (1) \| Respond to of 64865

Tazio - I treat the options as independent of the underlying, both in my thinking and for tax purposes. I like to sell calls when I think the underlying is stable or may decline somewhat. If it declines to the point where the calls have little value I will usually buy the position back and play again at a different strike. My basis on most of my portfolio is well below the current market - DELL at 9 and CPQ below 8, for example - and they are also long term holdings. I did actually sell of a substantial portion of my DELL position via calls - intentionally. I sold 50s in early January 1999 and the stock was called away a week or so later. I had intended to reduce my position at 50 and why not take the call premium too? The last few months have been a good environment for selling DELL calls and I have rolled them every few weeks. The only close call was on Nov 27.5s which I was actually holding when the stock ran above 28, but I was not called. But I have also been buying Feb 01 calls, as well as 2002 and 2003 LEAPs, so the call selling just helped to defray the cost. Do you ever do straddles? I have looked at some bull put straddles but I like the higher leverage of the straight positions. Still, the straddle limits the loss potential.