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Strategies & Market Trends : How To Write Covered Calls - An Ongoing Real Case Study! -- Ignore unavailable to you. Want to Upgrade?

To: Mark Mandel who wrote (6092)	12/11/1997 4:37:00 PM
From: Herm	Read Replies (1) \| Respond to of 14162

I will try to answer the question. First, most investors find a price range they can live with. Usually, stocks over $10 will do just fine. The more contracts you can write per round, the lower the cost of the commission. Basically, you don't really want to CC unless you have 300 shares (3 contracts) or more. Reason? It does not pay out enough! You don't normally start out with trading 10 contracts. Rather, you work up to that as you gain more experience, trading cash, and GUTs! You have to become deciplined in your MIND to be able to watch swings in the stock price and value of your portfolio. It is possible to see ranges between your high and lows of 40% in a given year if you are long on the stock. And of course, you can see in a month a 60% jump in value! It all depends on what industry group you are selecting! In the long run the rate of returns are fantastic provided you learn from your mistakes and stick to the techniques.