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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: Daniel Liberty who wrote (7967)	7/27/1998 2:51:00 PM
From: VincentTH	Read Replies (1) \| Respond to of 14162

Dan, I am considering moving my account from Fidelity to Waterhouse for the same reason. It would cost an arm and a leg to establish spreads at Fidelity, for margin requirements. (You need $10K for the first Debit spread, margin are not required for subsequent Debit spreads). On the other hand, the cost to buy/sell 5x2 options to set up 5 spread is about the same at Waterhouse ($37 for the long, and same for the short). There is no margin requirement for Debit spreads at Waterhouse. I suspect that at some other option oriented broker (Brown, PBS etc....) you can have substantial savings on commissions over Waterhouse. //Vincent.

To: Daniel Liberty who wrote (7967)	7/28/1998 1:25:00 PM
From: Chuck Molinary	Read Replies (1) \| Respond to of 14162

Dan, I've traded MO and CC'd it several times over the last four-five years with much success. However, I haven't been in it for at least a year. I think it's a great company with the capacity to print money BUT the Feds and Judges of this country seem intent on ruining it. Until there's a firm resolution on a settlement, I'm staying away. On the plus side, the stock has a great yield which provides a nice sideshow (to coin one of Herm's phrases). Management historically has regularly raised the dividend. A couple of years back, the yield on my original investment had grown to over 10% due to dividend increases. For me, the expected return of a CC is not enough reward vs. the potential downside of a particularly negative liability settlement. If the call premiums spiked up a bit, maybe, but right now, not for me. Hope this helps, Chuck