To: Jurgen Trautmann who wrote (8978 ) 2/15/2001 11:48:10 AM From: MonsieurGonzo Read Replies (3) | Respond to Wouldn't It Be Loverly... Best point for writing calls short would have been jan 24h... mo carry-over from the previous day and the NDX futures were bid way up pre-open ~ a large gap-up was indicated ~ and I felt that the market would open UP & sell DOWN all day, which it did. There was a transaction indicated at 8 before mine but, it must have been a buy, and not a sale ~ because I entered an order to SELL 15 QUEBK @ MKT as soon as I got a BIDxASK quote: my goal was to sell the FEB63C for 7 or better. What's the chance of this game? Related to your total ? and the idea is to generate around ~$5K per month either by selling 100s cap.gain or by selling CALLs on the $100K equity basis.mechanical and on the other: You feel "hedged" in the intermediate-term, free to concentrate your energy on short-term trading, for example.don't like about this approach is when QQQ dips down, WAY below strike, to re-test lows (like it just did) or worse, makes an even lower low ~ which defeats the strategy: I felt compelled to buy-back my FEB63C @ ~1 when QQQ fell to the 60~63 area, and now I have bought back 200s @ 58.8 and another 100s @ 55.5 (or better).position but, I under-estimated the downside extent .potential downside extent is > ~10%, we're better off getting out of the position altogether, buying a long PUT, 10% out-of-the-money and at least 60-days out (say, long MAR63P rather than short FEB63C).
