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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: Michael Hart who wrote (7682)	6/18/1998 8:10:00 AM
From: Caroline	Respond to of 14162

Hi Mike, Have never done it. I'm too afraid of being put a tanking stock. Regards

To: Michael Hart who wrote (7682)	6/18/1998 9:24:00 AM
From: R Sass	Read Replies (2) \| Respond to of 14162

It is important to realize that selling puts is the same as trading covered calls. Look at the profit loss picture, it will be exactly the same. Many people forget this. I always ask myself when doing a covered call if I would be willing to sell naked puts in the stock. If I am unwilling to sell naked puts, I will not do a covered call. The only benefit of buying the stock first and then selling the calls, is the ability to leg into the trade. This may provide a larger profit than would otherwise be available. Ralph

To: Michael Hart who wrote (7682)	6/18/1998 9:35:00 PM
From: Tom K.	Respond to of 14162

<<... could someone give their opinion/experience on using puts as an entry strategy to own a stock prior to CC'ing. >> Mike, I use this strategy and it works well. I feel that you must be prepared to buy if the stock tanks.... an alternative is to buy a protective PUT further OTM. Of the three PUT positions I have this month, one was closed early to lock in the profit, another will expire tomorrow at a profit, the third will be exercised tomorrow and I will come back with CALLs on it for next month. Hope that helps. Feel free to ask questions... I'm not an expert, but I've got a bit of OJT. Tom