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Strategies & Market Trends : Buy and Sell Signals, and Other Market Perspectives -- Ignore unavailable to you. Want to Upgrade?

To: GROUND ZERO™ who wrote (54080)	8/28/2013 1:59:23 PM
From: Machaon	Read Replies (1) \| Respond to of 222099

Thank you for your generous and thoughtful comments, I appreciate them... Just wanted you to know how much I appreciate, and learn from your posts. I did write calls on all my long gold and silver positions this morning ... I'm very satisfied with the gains right now... Arghhh! You had to do that to me! Causing me to think! Not fair! So...... what I did...... was to study covered calls for the past few hours. I've never written or sold a covered call before. I practiced making the trades and even tried to sell more call options than I owned, just to double check my understanding. Your words echoed thru my elderly, pill diminished noggin and I agreed with you that I was also very satisfied with my gain. I decided that I would lock in profits, and make a little extra on the covered call, and not care if SLV did rally up to $30 without me! So..... I sold the Sept 21st, in the money $21 SLV calls for $2.70, which produced about a net $0.15 in an extra gain. $0.15 is not much, but it is better than just cashing in the stock. In a way, I figured that I was getting paid $0.15 to sell my shares, so to speak. Plus... if silver does decide to take a big squat, which is not unlike the volatile metals, it would allow me to buy back the options at a much cheaper price.

To: GROUND ZERO™ who wrote (54080)	8/29/2013 11:44:17 AM
From: Machaon	Read Replies (1) \| Respond to of 222099

I did write calls on all my long gold and silver positions this morning... It's turned out to be a very good move. Nice going! I'm not going to be greedy and complain if these metals continue higher Then again, what's the greed factor as the metals move lower? I'm glad that I followed suit and wrote covered calls on my SLV. I've never written calls before, although I have purchased my share of calls and puts. It's been an interesting and learning experience. My covered calls have appreciated nicely. Thinking out loud... but if I buy them back at a nice profit, I lose the $2 per share protection to the downside AND I don't realize any profit because the shares are comparably lower in price! So..... buying back the covered calls is a losing proposition unless silver goes back up again. As a catcher of falling knives investor who buys on dips and then averages down, my best bet would be to hold on for a while and hope that silver corrects a little more, or even revisits $21 per share. Any thoughts on the metals, or metal premonitions from your model?