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

To: PoetTrader who wrote (2081)8/17/2001 12:14:37 PM
From: Road Walker  Read Replies (1) | Respond to of 5205
 
Poet,

Remember on that trade you are doubling your risk, with both the underlying and the short puts. If disaster strikes... Think what happens if the stock goes to $40. It's not fun buying $40 stock for $85.

Another play in a dicey market is to take some of the premium from the call sell, and buy a farther out of the money put. You still collect some premium, and most of your downside in protected. Not a home run play, but a fairly conservative options strategy. (called a collar)

John



To: PoetTrader who wrote (2081)8/17/2001 1:01:49 PM
From: rydad  Read Replies (1) | Respond to of 5205
 
Hi Poet,

I have been printing some of the good instructional posts from this thread the past 2 weeks.

The 2 most informative ones were 1855 by PAL and 1881 by mathemagician.

I liked the combination of those two strategies the best. Simple, straight forward not too risky (but that is relative)

Hope this helps. I hope I can be as helpful as those who helped me.


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