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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 (3312)	1/22/2002 2:16:18 PM
From: holland	Read Replies (1) \| Respond to of 5205

The difference is the fact that you don't own stock. You would have to sell the leap, buy stock which would then be called away. The gain would be in the difference in the strike price of the option and the price of the stock when you purchased the leap. You would have extra brokers fees for the stock and then repurchase on the leap. The goal should be to reduce the price of the leap by multiple call sells. If not don't buy a leap just buy the next mount out call. On covered calls not sold against stock you desire to retain you can select a stock with a high call price. In June I sold two that returned over 10% in two weeks.