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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: R. Gordon who wrote (6529)	1/23/1998 6:50:00 AM
From: Greg Higgins	Respond to of 14162

R. Gordon writes: Buy back the feb22.5 for 4 5/8, and sell the June 30s for 3 5/8. Suppose the stock goes to 30 within the week. The volatility will increase. Because of higher volatility and longer time, those June 30's might go for 7 or 8. Furthermore, once the stock does hit 30, you'd be able to play Sep 30's for something more (there are no Sep 30's now, but there will be once the stock hits 30). I suspect that with today's volatility, the Jun 30's are worth 6 ish when the stock's at 30. But a rapid move upward in a short period of time might affect that significantly. Thought's anyone?