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

To: 100cfm who wrote (1682)	7/31/2001 2:07:41 AM
From: Alias Shrugged	Read Replies (3) \| Respond to of 5205

<<Selling short is exactly what we are doing. >> 100 - No, you are not selling short. You are forgoing most (perhaps all?) of the upside in your stock in exchange for a fixed premium, while remaining exposed to the full fury of the downside (less the premium). Being long stock and short calls is equivalent to shorting puts naked. That is not selling short; it is a somewhat bullish position. When I write covered calls, I choose calls which are ATM or slightly OTM for usually the maximum time allowable. The critical decision is choosing a stock which you think has bottomed, since, as stated above, one is basically shorting puts naked when doing buy/writes. Mike