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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: Dan Duchardt who wrote (10391)	4/15/1999 10:17:00 PM
From: David Wright	Read Replies (2) \| Respond to of 14162

Dan, Go back to post 1123 from hpeace. Steve has a neat stepped into strangle strategy that you might like. I have been using it to step into protective puts as the stock prices move up. I usually place orders for both the CC and the insurance put at the same time. As soon as I get some declines, I will start stepping into upside protection calls. It would be nice to be able to place those at, or near the covered call strike price. His criteria was to pay 1/8 to 5/8 for his stranglers. I have been keeping it at an average of 1/4, and am striking at, or just below my breakeven with puts that protect me through the earnings report dates. As these May puts expire (or I sell them), I will re-evaluate where to place my insurance protection, as I wait for my covered calls to play out. As Steve points out, sometimes you only get one leg in place, and it expires at no value, so it takes some discipline to follow this strategy.

To: Dan Duchardt who wrote (10391)	4/15/1999 11:17:00 PM
From: jebj	Respond to of 14162

>. I don't know if it was myTrack letting me down, or ISP/internet problems. Just when I was telling you all myTrack was worth a look. Maybe should have kept quiet. - Dan Dan, in the year that I have been with MyTrack they have always had server problems. Seems they are much more interested in adding "goodies" that getting the basics of the system to work properly. It's a shame because they do offer a lot for the money - or even free. At least today they admitted it was their problem - usually they try to pass it off as line, ISP or whatever - even when most everyone is having the same problems. jb

To: Dan Duchardt who wrote (10391)	4/21/1999 7:39:00 PM
From: Dan Duchardt	Read Replies (1) \| Respond to of 14162

An update on my CYCH paper trade: CYCH seems for now to be settling into the sideways drift pattern I had anticipated, closing today at 17 13/16. As it stands, the May17 1/2 lot will be exercised leaving me the max upside of 10.7% (NUT = 15 13/16), while the June20 lot is 11.3% above the NUT (16). Still looking for a runup to bring the puts down to where I might buy in for protection. A further pull back could result in rolling down the calls again. For what it's worth, I calculated the "break-even" between my divided, rolled down position and David's suggested selling only the May20s and staying pat (not to be confused with the LEAP breakeven point Herm is teaching us about). At CYCH = 18 11/16, the returns are the same. Above that point, having sold only May20s would have a better return, plus the advantage of not getting exercised anywhere below 20, and the earlier expiration date. My next post will tell a tale of NSOL. Talk about ROCK and ROLL!!