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Technology Stocks : WDC/Sandisk Corporation -- Ignore unavailable to you. Want to Upgrade?

To: Jill who wrote (25905)	5/23/2004 11:55:05 AM
From: Art Bechhoefer	Read Replies (1) \| Respond to of 60323

Jill, anyone who sells covered calls must take into account both the price of the stock (whether it seems to be near a recent high) and tax or other consequences that might occur if the underlying shares were called away. Those factors limit the use of covered call sales but do not detract from the soundness of the strategy. Art

To: Jill who wrote (25905)	5/23/2004 1:44:34 PM
From: Howard R. Hansen	Read Replies (1) \| Respond to of 60323

If you are a longterm investor and sell covered calls, it is often not a good strategy, I agree for buy and hold investors selling covered calls in a rising market can limit an investors profit. But what if an investor needs to turn some of his holdings in stocks into cash to meet IRA withdrawal requirements or for living expenses. In this case if one selects a stock he or she is willing to sell, a target selling price and a time frame in which the sale should take place than selling covered calls can add a significant supplement to the cash raised from the sale of the underlying stock.