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Technology Stocks : Intel Corporation (INTC) -- Ignore unavailable to you. Want to Upgrade?

To: jackrabbit who wrote (137495)	6/18/2001 5:26:38 AM
From: Amy J	Read Replies (1) \| Respond to of 186894

Hi Jackrabbit, RE: "Would you write new calls on INTC now, or wait for a move up in the stock first? If you wrote now, what strike and expiration would you choose? I would appreciate hearing your thoughts." --------------- Out-of-the-money. I'd suggest using higher strike prices when going into a season where XP will be shipping. Regards, Amy J

To: jackrabbit who wrote (137495)	6/18/2001 10:42:57 AM
From: rudedog	Read Replies (2) \| Respond to of 186894

jackrabbit - my personal style may not be right for anyone else, so don't take this as advice - it's just the way I do it. I only sell CCs on companies I track closely. I like to sell near term calls, since that way I am not paying for the time value. Also my ability to predict a near term channel for the stock's range is a lot better than anything long term, so I stay within a 4 to 8 week time horizon. When I sell calls, someone buys them - the buyer obviously thinks the stock will run higher (and therefore the options will run too). The buyer does not need to wait until the stock is over the strike to make a profit, but the only way I lose money is if the stock is called - and probably not even then, unless I don't manage the position. The fact that my original buyers may have sold the calls to someone else is not my problem. My current sense (guess) is that INTC will not go over 32.5 before July expiration, so I covered about half of my INTC with July 32.5s early this month when the stock was closing in on 31, getting about 1.50... just a few days later the stock actually ran up to the strike but I was not called - it would have to go up to something like the strike plus the premium for a buyer to want to make a call. Today, with those calls at around .30, I have made out pretty well in only a few weeks. I will probably close out that position and go farther out. As I said above, this is just my somewhat simple minded way of working calls, and anyone getting into the game should do paper trades for a while to get comfortable with the way options move, and to assess the likely results of whatever plays they want to make.