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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: Sr K who wrote (13518)	1/27/2001 9:12:44 AM
From: BDR	Respond to of 14162

<<Often the option premiums contract early the week following expiration. Sometimes by exercising early, you can write covered calls for better premiums than if you wait until the next week.>> Is this because of covered call writers re-establishing their positions the week after expiration? Given that the option market is much less liquid than the stock market I could understand how a bunch of sell orders on Monday could bring premiums down. Do you have any idea of the average amount of contraction that occurs?

To: Sr K who wrote (13518)	1/27/2001 11:00:36 PM
From: Victoria Walley	Read Replies (1) \| Respond to of 14162

Also, one time I exercised long calls 50 cents out of the money on expiration day I'm missing something here... why would someone exercise a call that expired out of the money when they could have purchased the underlying for a lower price? Index options are a very different animal, aren't they? I've no experience with them yet. Put buyers are much more likely to exercise early, at just the worst possible time if you are the seller! Often the option premiums contract early the week following expiration Yes, I will often close out CC positions once they are front month but prior to expiration just so I can go out to the next month and get the extra premium. It's often just not worth it waiting for that last dollar of time to decay. Thanks for posting your experiences! Vicki