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Strategies & Market Trends : The Covered Calls for Dummies Thread -- Ignore unavailable to you. Want to Upgrade?

To: Uncle Frank who wrote (8)	4/19/2001 1:19:10 AM
From: mightylakers	Respond to of 5205

Looks like my jdsu will be collected away with my April 17.5 calls under the water now. Damn the FED for the sudden cut<ggg>

To: Uncle Frank who wrote (8)	4/19/2001 1:29:07 AM
From: tekboy	Read Replies (1) \| Respond to of 5205

you might want to review this before making any moves... Message 13296557 :0) dtb

To: Uncle Frank who wrote (8)	4/19/2001 4:33:42 AM
From: kas1	Read Replies (1) \| Respond to of 5205

Not at all. The psychology of this game is always positive, since you never lose capital. Actually, you do, if you've written out of the money calls and want to hold on to the position. [nb: UF, is this what you'd call "chasing the stock" ?] Say stock ABC is at 100 at the beginning of the month. Say you write calls on your stock, strike price 120. Say the stock goes up to to 125 before expiry. I don't have the Black-Scholes in front of me here, but my hunch is that under such a scenario, your loss on shorted calls is greater than your gain on the underlying common. Can anyone recommend a good website that will do "what if" scenarios with graphs etc? Book recommendation for anyone thinking about any options plays: Options as a Strategic Investment, by Larry McMillan. It probably goes way beyond the needs of someone who just writes covered calls, but it's always good to know what options techniques are out there.