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Technology Stocks : Compaq -- Ignore unavailable to you. Want to Upgrade?

To: James F. Hopkins who wrote (22583)	3/19/1998 12:18:00 PM
From: Andreas	Read Replies (1) \| Respond to of 97611

I understand your position. My philosphy is a little different, however. I am not inclined to write calls to January 2000 (22 months out) for lets say $7.00. I am not that concerned about being called since I I can typically avoid being called by rolling up or out or up and out.. Let's assume that by 3rd friday in april cpq is 26.00. The May 25 will (based on past experience) be about $1.00 more than the April $25. I'll buy back the april 25 and sell the may 25. In seven months I will be approximately $7.00 ahead. Lets assume for the moment that I keep doing this for 7 months and after 7 months (October) the stock is $35/shr (hallelujah!). At that point I may decide to roll up and out by buying back the October 25s and selling the September 30s. It will cost me, but it will be more than offset by the $5.00/shr pick-up on the stock price. That's my thinking, right or wrong. If anyone wants to tell me I'm nuts and the reasons why please go ahead. I'm a humble guy with a thick skin always ready to learn something new that may make me some money.