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Strategies & Market Trends : Gorilla and King Portfolio Candidates -- Ignore unavailable to you. Want to Upgrade?


To: Dinesh who wrote (50122)1/29/2002 12:19:09 PM
From: Uncle Frank  Respond to of 54805
 
>> why would you assume the risk of being called against
your long-term outlook?

The risks are small, and virtually non-existent in a sheltered account.

>> Isn't that functionally equivalent to trading?

No, not even close.

>> One could easily have bought SEBL at 20- in last
few months and written a say $30, 2 month call.

You can only get pennies (if you're lucky) by writing $30 strikes against a $20 stock. It's not worth the effort.

>> just trying to clarify the fine details of a given strategy

Covered calls are interesting but complex, Dinesh. I'd recommend you read the first several hundred posts on FaultLines CC thread:

Subject 51101

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