Covered Calls Plus - Keeping an eye on an existing Covered Call, or Protective Put position

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Monitoring an Existing Position
As the title implies, the 'Monitoring' section of this tutorial addresses the task of keeping an eye on an existing position. This section also delves into the more advanced techniques offered by Covered Calls + that add flexibility, ease of use, and promote a better understanding of the option pricing model.

The Initial View for an Existing Position
Once a position has been established and recorded, the opening of the program follows the same sequence - the logo is followed by the Tip of the Day, both of which precede the appearance of the Initial View. Clicking the arrow on the Initial View drop down box will display the file names of all open positions. You can open the desired file by first clicking on the name of the file in the drop down box, then clicking the command bar labeled - ' . . . or select an Existing File, then click here'. If the existing Option contracts have already expired, Covered Calls Plus will present a dialog box asking for the closing price of the underlying Stock at the close of trade on the last trading day prior to expiration. This information will be used to post the action at expiration on the Accounting View, while clearing out the variables related to the expired position. If the existing position chosen has not expired, the Initial View will expand and display a description of the position as shown below.
To take a look at where you presently stand with this position, first enter the risk free interest rate where the cursor is blinking. If the dividend information was entered when the position was first opened, it won't hurt to review that information now. Once an X-Dividend date has passed, CC+ will revise the date using the original date and the frequency of dividend payments. If that is the case, check to make sure the revised date is correct, if need be, tab through making any other changes to the dividend information that may have occurred since last opening the file.

When monitoring an open Position, be prepared to evaluate the situation when there has been a significant move in the underlying Stock, or expiration is drawing near.

In the middle of the expanded Initial View, you will see a description of the alternatives available to monitor or evaluated the position. The four alternatives are:

'Add to the existing Position' - appropriate when all you want to do is add additional shares or options that are already a part of the current Position.
'Reduce, Close or Evaluate the Open Position' - this is your choice if you want to reduce the number of shares and/or the number of open option contracts. It is also the best route to take when just seeing where the position currently stands, as well as closing the position entirely.

When either of these two radio buttons are clicked, a dialog box will appear with an explanation of how to save a bit of time when adding to, reducing, closing, or just monitoring an open position. Simply put; the default stock and option spreads will be used to calculate the Stock or Option bid's or ask's that you have not entered. When clicking the 'Adding To' radio button, the spreads will be used to calculate the Stock bid and the Call offer or Put bid. If 'Reduce . . .' is selected, the spreads will be used to calculate the Stock offer, Call bid or the Put offer. To be completely accurate, the default spreads need to be updated to reflect the actual bid and ask differences, this can be achieved through the Quote Entry View menu by selecting 'Tools/Stock & Option Spreads'. Once this dialog box is closed, the Quote Entry View will appear.

The remaining two radio buttons on the Initial View, offer the following alternatives:

'Rolling Covered Calls' - this alternative is offered when the existing position already has open Calls. If no Calls are in the position it would read - 'Sells Calls to Open'.
'Buy Puts and/or Roll Calls' - going this route will give you the opportunity add Puts as well as roll the existing Calls.

Clicking either of these two radio buttons will expand the Initial View to include the 'Call Expiration Date & Strike Price Choices' drop down boxes, or the drop down choices for both Calls and Puts.

For this Tutorial we will assume that the Stock has risen significantly, so rolling the position will be investigated. The underlying Stock has moved up to 32.00, an increase of 2.75 points from when the open Calls were initially sold when the Stock was at 29.75. Our opinion of the Stock, which originally had been fairly bullish, has been tempered to neutral to slightly bullish, due to the substantial rise in the price. Therefore we will take a look at rolling up to December 32 1/2's, or rolling out to January 30's, or rolling out and up to January 32 1/2's.
These values need to be checked off in the drop down boxes as illustrated above. Now you are ready to proceed to the Quote Entry View by clicking the appropriate command bar or selecting 'Go To/Quote Entry View from the Initial View menu.