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 : MSFT Internet Explorer vs. NSCP Navigator -- Ignore unavailable to you. Want to Upgrade?

To: XiaoYao who wrote (17628)	2/24/1998 6:33:00 PM
From: miraje	Respond to of 24154

YuanQing, 1. Covered calls by definition means you own the underlying shares. If you own 1000 shares, you could sell from 1 to 10 covered calls. 2. If you sold calls with a $90 strike price, you are giving the buyer the option of purchasing your shares at that $90 price any time up until the option expires. As a general rule, in the money options are not exercised until right before they expire. If you sold MSFT March 90 calls and the stock was at or below that price on the 3rd Friday of next month, your shares would most likely not be called from you. If the stock was higher than $90 at that time and you wanted to keep your shares, you could buy back the options you sold to close the position. At a given strike price, say $90 for instance, the time premium increases the farther out the date of expiration. You could sell an April 90 call for more than a March 90 and so on. If you'd like to discuss option strategies in detail, send me an e-mail and I'll be happy to continue this offline. It's really not as complicated as it sounds <gg>. Regards, JB