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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: Joseph Francis Torti who wrote (8061)	8/3/1998 8:22:00 PM
From: Caroline	Respond to of 14162

Probably, I don't calc that way, but you could very well be right. sym bid ask targ p/l crbid p/l crbid p/l shs outlay hd 43.375 43.375 43.375 0 42.25 -225.00 40.625 -550.00 2.0 8675.00 hd 41.125 41.125 41.125 0 42.25 112.50 40.625 - 50.00 1.0 4112.50 -112.50 -600.00 Reading my notes across: HD purchased at the hypothetical 43 3/8 x 43 3/8 with a target of 43 3/8. The profit is zero. The first crbid column is what you would get if you sold the call at 2.25, i.e., $40 (strike) plus $2.25 (premium), or 42.25. Selling 3 calls brings your loss to $112.50 (not including commissions). The second crbid column is the actual HD current bid of 40 5/8. Selling the stock at 40 5/8 without selling the calls is a loss of $600. You probably will not get called tomorrow, but if HD is at or above 40 on Friday, you will get called. Of course, if you don't get called, you keep the premium and sell the stock and you're still out. Regards