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.

Strategies & Market Trends : How To Write Covered Calls - An Ongoing Real Case Study! -- Ignore unavailable to you. Want to Upgrade?

To: Dnorman who wrote (7732)	6/22/1998 8:29:00 PM
From: VincentTH	Read Replies (2) \| Respond to of 14162

Dennis, I believe you missed the Technical aspect of Covered Calls in Herm's on-going case scenario. I believe Herm said many times that he prefers to sell the calls when the stock price is at the upper Bollinger band (and RSI in oversold etc...), and that you preferably sell an ITM call above your NUT for best protection against a possible down turn. With that in mind, a 3 week paper trade period may not be sufficient. Your trial period should at least cover an earning release (not to mention Dividends which would also affect your plays). The other thing I would like to mention is the fact that CC is vulnerable to a sudden down turn of the stock, since doing CC, you are required to hold the stock for the duration of the calls. I have been taken off guard with SMOD (and a big loss), and I believed VVUS cost Herm quite a bit. Good luck!