Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Intel Corporation (INTC) -- Ignore unavailable to you. Want to Upgrade?

To: David Musser who wrote (40536)	11/17/1997 6:29:00 PM
From: Wilson Picket	Read Replies (1) \| Respond to of 186894

I am a newbie at call writing. I have made a few exploratory covered writes to get my feet wet. I'm still having trouble figuring a proper strategy, since I'm loath to have the stock called away, due to high commission costs. I restrict to very short durations with the expectation to buy back quickly if the stock is called. Unfortunately, my impression is that the recent crash has seriously deflated the option premiums on INTC and it doesn't look at all as favorable right now as just three months ago. I can easily see INTC getting back over 90 by Jan, or even Dec.

To: David Musser who wrote (40536)	11/17/1997 10:24:00 PM
From: Elmer	Read Replies (2) \| Respond to of 186894

David, I have been selling covered calls on my long position in my trading account for about the last year. I am very happy with the results. I aim for about $0.50 - $0.75 a share and I only sell the current month. There would be serious tax considerations if I should be assigned, so I don't push the limit. If the options go into the money then I simply buy them back and close them out. It has work very well to my advantage and I intend to continue with this strategy. I do the same thing with my ira with a target premium of ~$1.00 - $1.50. I use the income to buy more Intel shares. My share count is up ~15% this year. I was assigned once in my ira. Don't be afraid to look into this, in some ways, it's almost free money. EP