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

To: tcmay who wrote (137505)	6/17/2001 2:32:18 PM
From: Elmer	Read Replies (1) \| Respond to of 186894

There are some who claim they write _other_ options to pay for this loss, e.g., to roll their positions forward, but this is the opposite of a "conservative" strategy--this is hoping to win back losses by doubling down. No this is not doubling down. No additional money is put on the table(in fact no money was ever put on the table, only someone else's money was taken off) while the strike price is raised. This is making money with no money ventured. While you are correct in pointing out that opportunity can be lost, you are looking at only one stock. If one applies this approach to a portfolio of issues you may see market beating returns. It would be nice to see a study of this approach. EP

To: tcmay who wrote (137505)	6/17/2001 6:32:27 PM
From: maui_dude	Read Replies (2) \| Respond to of 186894

Tim, Re : "claims here about much money people have made are usually misleading" You may be right in that there is no guarantee in making more by writing covered calls as compared to just holding the stock. I think it all depends on how you predict the market to behave. However, if you can predict the market pattern, options trading will always make more money (by writing covered calls in a flat market, writing out of the money calls in a slightly bullish market and so on). Now you can argue and say that it is not smart (and possible to do it reliably) to time the market. But I really doubt if there are many investor who do not try to time to market and play into the prediction game, alteast to some extent. Otherwise, an intel investor will have almost no gain to show for since August 1997. A combination of good prediction and writing covered calls (with rolling over the calls if got called or wait till it dips again) will be a statistically more productive investment strategy. BTW, A stock is just a special case of a covered call, which expires at infinity and you get zero premium. Maui.