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Politics : Formerly About Applied Materials -- Ignore unavailable to you. Want to Upgrade?

To: Larry Ames who wrote (43004)	3/4/2001 9:23:23 AM
From: Jerome	Read Replies (1) \| Respond to of 70976

What do you do if you get called out at a low level when you may still have a net loss for the series of call/writes? With ATML if I get called out at 12 1/2 I will be getting called out at a small loss. Here is how I rationalized it all. My Cost basis is for ATML is now 14 1/2 after two call writes and ATML is trading at 11.If I sell ATML here I lose $350.00 per 100 shares of ATML. If I sell at 12 1/2 I lose $250.00 per 100 shares. The 100.00 in call premium reduces that to $150.00 per 100 shares. Here I'm taking a chance. Is anything in 10 trading days going to move ATML from 11 to 14 or 15? It could but the news on the Nasdaq has been very negative. If I get called out at 12 1/2 I will net $6250.00. ATM finishes the month at 14. I will decide then to either buy back 446shares of ATML (6250 divided by 14) or 500 shares of ATML and then immediately write the ATML 15's for the following month. Writing the 15's makes the whole mess profitable. Every now and then a stock gets caught in what I call a never never land where the forward premium is not worth a hoot. ATML at 13 and the next strike is 15 with little or no premium. ASYT at 15 1/2 and the 17 1/2's are worth less than a half point. My idea here is to wait a little while for a strong up day in the semi's to see how this stock acts and then either go out one or two months for worthwhile premium. Posters on this thread and a whole lot of other threads have some kind of hang up about selling things at a loss. Heck we sell a lot of things at a loss, from $20,000.00 cars to $100,000.00 properties. Has any one on this thread bought a new Ford or Chevy in the last year or so with the idea of selling it at a profit? The idea is not to sell at a loss, but if the hand (in stocks) that you are holding is going to take 10 years to see daylight its best to look around at a better universe of investments. I think Brian, Gottfried, Cary, Michael, Jacob, and a whole lot of other thread posters are correct in believing that AMAT will move from the $ 45 range to the $90 at some time in the future. It could take six months (maximum optimism) or it could take 48 months (maximum pessimism). In the meanwhile I'm doing the covered call thing. The rent payment comes due every moth and the bank does not want to hear that I'll get all caught up when AMAT hits $90.00 a share. Regards, Jerome