Date: Fri, 13 Feb 2004 08:34:51 -0500 From: Adam Weinberger <adamw@FreeBSD.org> To: Earl Smith <t_esmith@hotmail.com> Cc: freebsd-ports@freebsd.org Subject: Re: Writing covered calls Message-ID: <20040213133451.GF3365@toxic.magnesium.net> In-Reply-To: <BAY8-F33WeUv8IuXGF40001660f@hotmail.com> References: <BAY8-F33WeUv8IuXGF40001660f@hotmail.com>
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>> (02.13.2004 @ 0756 PST): Earl Smith said, in 1.1K: << > I found a stock selling for 42.76 - this stock looks to be on the rise. > The April 42.50 call last sold for 2.55. If I buy the stock for 4276 and > sell the option for 255, my cost basis in the stock is 4021. If the option > is exercised, it seems to me that I have 229 minus commissions. I think I > recognize some of the potential shortcomings for this strategy - the stock > might not rise enough for the option to be exercised, or the stock might > fall, in which case I wouldn't be called; the stock might rise enough for > me to have made more money buying the stock and selling it at a profit; I > might not be able to find a buyer for the option. > > Are there some other pitfalls that I don't see? > > Thanks, > Earl Smith > t_esmith@hotmail.com > > _______________________________________________ > freebsd-ports@freebsd.org mailing list > http://lists.freebsd.org/mailman/listinfo/freebsd-ports > To unsubscribe, send any mail to "freebsd-ports-unsubscribe@freebsd.org" >> end of "Writing covered calls" from Earl Smith << You should invest in MC Hammer pants. Those things are due to become super popular any day now. # Adam -- Adam Weinberger adam@vectors.cx // adamw@FreeBSD.org // adamw@magnesium.net http://www.vectors.cx
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