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Technology Stocks : Intel Corporation (INTC) -- Ignore unavailable to you. Want to Upgrade?

To: Erwin who wrote (56057)	5/25/1998 12:23:00 AM
From: Amit Patel	Read Replies (2) \| Respond to of 186894

> If the market is at or below 90 you will probably not be called and > you get to keep the stock. Just make sure your head is set to give > the stock up if you are called. Current prices for 90 calls are > about: > July 7/16 > Oct. 2 1/8 > Jan 3 3/4 Yeah, Writing covered call does seem like a good idea at times. However, if you are called, you don't necessarily have to give your stock up. You can roll it over to a farther date and buy more time for a higher strike price (this way you can postpone paying capital gains taxes too!). For example : If INTC stock is at 96 in Jan, the call price would be around 6 (for Jan 90 calls). Instead of handing over the stock, you can pay $6 and keep the right to the stock and write calls for, say July 100. Hopefully, the stock won't reach 100 by July and you can keep the stock. Sure, this approach has its downsides too. Looking at Intel call prices, this seems to be a relatively safe way to make about 20% profit annually (provided you've made up your mind to not sell intel in the short term and you are will to miss out on a very big run by intel in a short run). I have had very little experience with writing calls and am just beginning to get into it. I would appreciate if someone with more experience on writing calls can add to this. Thanks. -Amit.