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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 (1142)	6/20/2001 8:55:35 PM
From: Stock Farmer	Read Replies (2) \| Respond to of 5205

Hi UF... I think we crossed wires. What I'm trying to say is that you seem to be all hung up on continuously owning the company. Not that the amount of capital you are manipulating is small. But that you seem to be attaching undue importance to the aspect of having the shares called away. A cc strategy entertains the risk that you will be called out. Folks who do mind this end up spending money to buy back calls and write new ones. Folks who don't mind spending a brief period of time not owning the certificate can improve their returns by writing the same strike puts as they would have written calls. Sooner or later fortunes reverse and presto, you get assigned and have your shares back. At any intermediate position you can also roll out to pick up the shares. Just the reverse of rolling up the call. So I'm not talking about some maverick scheme to overmargin myself. Nor about some high finesse bear spread. I'm talking about a covered call scenario using a synthetic long position when you happen to have cash, and an actual long position when you do not. Simple. I don't get it that you don't seem to get it. John