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

To: AnnaInVA who wrote (2579)	10/6/2001 2:28:19 PM
From: FaultLine	Read Replies (2) \| Respond to of 5205

Hello AnnalnVa, sold the Oct 20 calls for 4.90 I do not understand why the QLQJD OCT 20 is only 1.45 right now. It is in the money to the tune of 7.50. I'd probably buy these back at 1.45 and take my 4.90-1.45=3.45 (!) profit. Not bad, not bad at all. --fl

To: AnnaInVA who wrote (2579)	10/6/2001 4:05:23 PM
From: Uncle Frank	Read Replies (2) \| Respond to of 5205

>> long QLGC from 25.5 when it fell, I panicked and sold the Oct 20 calls for 4.90... should I cover and roll over to Nov 25 or 30 QLGC has had a nice bounce, but the chart looks as ugly as all get out. finance.yahoo.com It appears you were trying to hedge by writing the Oct. 20s. I've made that mistake myself, and learned that covered calls are a lousy hedge, but the biggest mistake I made was buying the calls back once they were deep in the money. As it stands, you're hardly damaged at all. If you were to be called, you'd receive 20+4.90 for a short term investment of 25.50, which is only a .60 (2.4%) loss, but you could dig yourself a much deeper hole by buying the calls back and then having qlgc tank. Why not wait for a bit and see if it looks like qlgc will be able to sustain the increase? uf