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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: Herm who wrote (8107)	8/6/1998 9:35:00 AM
From: Dr. No	Read Replies (2) \| Respond to of 14162

Herm: I can't thank you enough for taking the time to give such in depth responses! If it wasn't for you on this thread, a lot of novices such as me would lose their shirt in the stock market. Herm, in your various stock analysis for buying PUTs, besides BB and RSI indicators your are looking at the recent history of short positions. The larger the short positions the harder the stock falls. What kind of % increases you look for in the short positions to make your decision to buy PUTs. Also what other data do you look for before you buy the PUTs Thanks again for all your help. Mo

To: Herm who wrote (8107)	8/6/1998 12:18:00 PM
From: David Mckenna	Read Replies (1) \| Respond to of 14162

Herm, Where do you obtain the SHORT interest in a stock? What is the time period for a Leap vs Option? (e.g. <>1 year) I've bought ELYBC (Calloway, call option, $15, February), it this an option or a leap? Can I still write short term CC's against ELYBC to collect small premies? Love this thread, Dave

To: Herm who wrote (8107)	8/6/1998 2:09:00 PM
From: RayV	Read Replies (1) \| Respond to of 14162

Herm In terms of watching BB/RSI how do you read a sudden downturn on (non) news like RXSD has recently? I'm thinking it looks like a steal. Ray

To: Herm who wrote (8107)	8/6/1998 9:56:00 PM
From: Vol	Read Replies (1) \| Respond to of 14162

<< In a LEAPs CC setup, if you are called out of your CCs your LEAPs will automatically be exercised at the CC strike price. The difference between the CC strike price you wrote is subtracted from the LEAP strike price and you get to keep the difference. So, your LEAP Strike is at $10 and your CC Strike is at 12 1/2 you get $12 1/2 - $10 = $2 1/2 to keep plus the CC premie(s) you collected along the way. >> Correct me if I'm wrong, but I think your broker gives you an option on how to deliver stock when your short calls are exercised. If you just handed over the LEAP in this example, you would about break even: Premie - cost of LEAP + difference in strikes in calender spread = profit 1.25 - 3.5 + 2.5 = 0.25 (commishes not incl) I think a better return might be to buy the stock at current price to cover short call and sell appreciated LEAP to get some of that extrinsic value that you paid for back. Make sense? Vol