09-28-2013, 01:02 PM
First, the decision to sell straight out or to sell calls, IMO, should be based upon comfort level with the position. I think that selling calls against a position that should be sold outright would generally be a mistake.
If reasonably comfortable with the position, but merely wanting to decrease shares, then the strategy you suggest makes sense to me. Though I am much closer to novice than veteran or expert. Depending upon comfort level, you may want to consider the November calls which would bring in about another dime, plus don't expire until AFTER the next dividend. Another issue worth exploring is the trading cost. TDA charges me the same $7 for an options trade. Sometimes just a call to the broker is all that it takes to get a lower fee or a lower margin rate.
TDAmeritrade has excellent resources on tax lots. The info is found under 'Accounts' 'Tax Center' and is listed at the bottom of the page under 'Understanding tax lots'.
For the trade that you are talking about, and the potential minimal gains, I doubt that I would bother in a taxable account.
If reasonably comfortable with the position, but merely wanting to decrease shares, then the strategy you suggest makes sense to me. Though I am much closer to novice than veteran or expert. Depending upon comfort level, you may want to consider the November calls which would bring in about another dime, plus don't expire until AFTER the next dividend. Another issue worth exploring is the trading cost. TDA charges me the same $7 for an options trade. Sometimes just a call to the broker is all that it takes to get a lower fee or a lower margin rate.
TDAmeritrade has excellent resources on tax lots. The info is found under 'Accounts' 'Tax Center' and is listed at the bottom of the page under 'Understanding tax lots'.
For the trade that you are talking about, and the potential minimal gains, I doubt that I would bother in a taxable account.
Alex