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: Andrew Williams who wrote (8567)	9/15/1998 8:26:00 AM
From: Herm	Respond to of 14162

Howdy Andrew, Wow! What a massive decrease in such a short time span. The ITWO RSI reading of around 20 now is lower than the previous bottom of 25 RSI going back to July 1996. I'm glad and happy that at least you have a good fighting chance to make a profit sooner than those without a game plan. As you gain more confidence with W.I.N.S. you will do even better. The ITWO P/E still has some fat on the bone. Although, the chart looks like an extended period of sideway motions with a slight up/down. The first overhead resistance level would be $20.00 because those investors that previously paid $20 (look at the chart history) will not think twice to unload when ITWO approaches a break even for them! bigcharts.com ITWO P/E VALUE NASDAQ: (ITWO : $14 5/8) $1,015 million Market Cap at September 14, 1998 Trades at a 7% Premium PE Multiple of 40.6 X, vs. the 38.0 X average multiple at which the Software & Services SubIndustry is priced. I-increases S-sideshows Tools Take a look at the ITWO NOV 17 1/2 Calls as CCs. You could use the premies to buy your own sideshow calls at lower strike prices. In other words the recovery spread. You write twice as many CCs at 17 1/2 and use the stock itself and the purchased lower strike at the same month calls in the spread. askresearch.com Using Doug's recovery spread (online template tool) at webbindustries.com here are the possible spreads. You want to get the best performance outcome for an ITWO stock price between $14 and $20 since we know ITWO will head a road block at that point. Also, we want your CCer to be on the losing end of the spread. You would cover and cash out before the expiration date and avoid being called out. I was not sure how many shares you had so I put into the fields a net cost of $18 and 500 shares. Series Long Short Entry Credit Total Gain SEP98 Call Buy 5 @ 15.0 Sell 10 @ 17.5 ($156.00) $844.00 Outperforms Stock Ownership in price range: $15.69 - $19.69 OCT98 Call Buy 5 @ 17.5 Sell 10 @ 22.5 ($312.00) $4438.00 Outperforms Stock Ownership in price range: $18.50 - $26.88 OCT98 Call Buy 5 @ 20.0 Sell 10 @ 22.5 ($124.50) $3375.50 Outperforms Stock Ownership in price range: $20.62 - $24.75 OCT98 Call Buy 5 @ 17.5 Sell 10 @ 20.0 ($125.00) $2125.00 Outperforms Stock Ownership in price range: $18.50 - $22.25 OCT98 Call Buy 5 @ 15.0 Sell 10 @ 17.5 ($125.00) $875.00 Outperforms Stock Ownership in price range: $16.75 - $19.75 OCT98 Call Buy 5 @ 12.5 Sell 10 @ 15.0 ($125.00) ($375.00) Outperforms Stock Ownership in price range: $15.75 - $17.25 NOV98 Call Buy 5 @ 20.0 Sell 10 @ 40.0 ($468.50) $20531.50 Outperforms Stock Ownership in price range: $21.06 - $59.06 NOV98 Call Buy 5 @ 22.5 Sell 10 @ 40.0 ($312.00) $19438.00 Outperforms Stock Ownership in price range: $23.25 - $56.88 NOV98 Call Buy 5 @ 25.0 Sell 10 @ 40.0 ($218.50) $18281.50 Outperforms Stock Ownership in price range: $25.56 - $54.56 NOV98 Call Buy 5 @ 20.0 Sell 10 @ 37.5 ($468.50) $18031.50 Outperforms Stock Ownership in price range: $21.06 - $54.06 NOV98 Call Buy 5 @ 27.5 Sell 10 @ 40.0 ($156.00) $17094.00 Outperforms Stock Ownership in price range: $27.94 - $52.19 NOV98 Call Buy 5 @ 22.5 Sell 10 @ 37.5 ($312.00) $16938.00 Outperforms Stock Ownership in price range: $23.25 - $51.88 NOV98 Call Buy 5 @ 30.0 Sell 10 @ 40.0 ($156.00) $15844.00 Outperforms Stock Ownership in price range: $30.44 - $49.69 NOV98 Call Buy 5 @ 25.0 Sell 10 @ 37.5 ($218.50) $15781.50 Outperforms Stock Ownership in price range: $25.56 - $49.56 NOV98 Call Buy 5 @ 20.0 Sell 10 @ 35.0 ($468.50) $15531.50 Outperforms Stock Ownership in price range: $21.06 - $49.06 NOV98 Call Buy 5 @ 32.5 Sell 10 @ 40.0 ($62.00) $14688.00 Outperforms Stock Ownership in price range: $32.75 - $47.38 NOV98 Call Buy 5 @ 27.5 Sell 10 @ 37.5 ($156.00) $14594.00 Outperforms Stock Ownership in price range: $27.94 - $47.19 NOV98 Call Buy 5 @ 22.5 Sell 10 @ 35.0 ($312.00) $14438.00 Outperforms Stock Ownership in price range: $23.25 - $46.88 NOV98 Call Buy 5 @ 35.0 Sell 10 @ 40.0 ($93.50) $13406.50 Outperforms Stock Ownership in price range: $35.31 - $44.81 NOV98 Call Buy 5 @ 30.0 Sell 10 @ 37.5 ($156.00) $13344.00 Outperforms Stock Ownership in price range: $30.44 - $44.69 NOV98 Call Buy 5 @ 25.0 Sell 10 @ 35.0 ($218.50) $13281.50 Outperforms Stock Ownership in price range: $25.56 - $44.56 NOV98 Call Buy 5 @ 32.5 Sell 10 @ 37.5 ($62.00) $12188.00 Outperforms Stock Ownership in price range: $32.75 - $42.38 NOV98 Call Buy 5 @ 37.5 Sell 10 @ 40.0 ($93.50) $12156.50 Outperforms Stock Ownership in price range: $37.81 - $42.31 NOV98 Call Buy 5 @ 27.5 Sell 10 @ 35.0 ($156.00) $12094.00 Outperforms Stock Ownership in price range: $27.94 - $42.19 NOV98 Call Buy 5 @ 35.0 Sell 10 @ 37.5 ($93.50) $10906.50 Outperforms Stock Ownership in price range: $35.31 - $39.81 NOV98 Call Buy 5 @ 30.0 Sell 10 @ 35.0 ($156.00) $10844.00 Outperforms Stock Ownership in price range: $30.44 - $39.69 NOV98 Call Buy 5 @ 20.0 Sell 10 @ 30.0 ($343.50) $10656.50 Outperforms Stock Ownership in price range: $21.06 - $39.31 NOV98 Call Buy 5 @ 32.5 Sell 10 @ 35.0 ($62.00) $9688.00 Outperforms Stock Ownership in price range: $32.75 - $37.38 NOV98 Call Buy 5 @ 22.5 Sell 10 @ 30.0 ($187.00) $9563.00 Outperforms Stock Ownership in price range: $23.25 - $37.13 NOV98 Call Buy 5 @ 25.0 Sell 10 @ 30.0 ($93.50) $8406.50 Outperforms Stock Ownership in price range: $25.56 - $34.81 NOV98 Call Buy 5 @ 20.0 Sell 10 @ 27.5 ($343.50) $8156.50 Outperforms Stock Ownership in price range: $21.06 - $34.31 NOV98 Call Buy 5 @ 27.5 Sell 10 @ 30.0 ($31.00) $7219.00 Outperforms Stock Ownership in price range: $27.94 - $32.44 NOV98 Call Buy 5 @ 22.5 Sell 10 @ 27.5 ($187.00) $7063.00 Outperforms Stock Ownership in price range: $23.25 - $32.13 NOV98 Call Buy 5 @ 17.5 Sell 10 @ 25.0 ($499.50) $6750.50 Outperforms Stock Ownership in price range: $19.12 - $31.50 NOV98 Call Buy 5 @ 25.0 Sell 10 @ 27.5 ($93.50) $5906.50 Outperforms Stock Ownership in price range: $25.56 - $29.81 NOV98 Call Buy 5 @ 20.0 Sell 10 @ 25.0 ($218.50) $5781.50 Outperforms Stock Ownership in price range: $21.06 - $29.56 NOV98 Call Buy 5 @ 22.5 Sell 10 @ 25.0 ($62.00) $4688.00 Outperforms Stock Ownership in price range: $23.25 - $27.38 NOV98 Call Buy 5 @ 17.5 Sell 10 @ 22.5 ($312.50) $4437.50 Outperforms Stock Ownership in price range: $19.12 - $26.88 NOV98 Call Buy 5 @ 20.0 Sell 10 @ 22.5 ($31.50) $3468.50 Outperforms Stock Ownership in price range: $21.06 - $24.94 NOV98 Call Buy 5 @ 15.0 Sell 10 @ 20.0 ($499.50) $3000.50 Outperforms Stock Ownership in price range: $17.62 - $24.00 NOV98 Call Buy 5 @ 17.5 Sell 10 @ 20.0 $0.50 $2250.50 Outperforms Stock Ownership in price range: $0 - $22.50 NOV98 Call Buy 5 @ 15.0 Sell 10 @ 17.5 $62.50 $1062.50 Outperforms Stock Ownership in price range: $0 - $20.12