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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: David Wright who wrote (10402)	4/17/1999 12:20:00 AM
From: NateC	Respond to of 14162

I read the WINS vs hpeace dialogue a lot like D Wright. My interpretation is that Herm's WINS is helpful to find the right stock at the right time....buy it,and CC it....and have enough premium so the "other dude" pays for your sideshows....which should be potential money making plays. (maybe long upstrike calls.....maybe buying puts) Steve's approach was to leg in....first buy the stock...then (as I recall), sell the CC on stock weakness.....THEN....if you get an up day or two.........buy a protective put, for 1/4 or less (when possible)...this protects your downside).....then....if you get it, a down day...and then on the down day, you buy the upstrike put....againfor 1/4 or so...and this protects you fromthe runaway. when the dust clears on this scenario...you have a short (covered) call, a long (upstrike)call. These 2 calls represent a vertical spread...hopefully a credit spread....although the term spread is more frequently used, when you are not long the underlying stock. Then the PUT, you buy for protection (buying it on strength, to keep the price down), protects you from huge dips, say at earnings report time. The last thing you could do...if you love to give your broker commissions....is to SELL a put, if you want more premie...and you love the stock..and don'tmind buying more......and if you do this...you're basically in a butterfly spread position,although you are long the underlying.