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Take the opposite side


If the option sold is strongly in the money, or if the intrinsic value significantly exceeds the time value, it may make sense to cover the option and take the opposite side: for example, after buying back the sold call, sell the security and sell a put on this security with a lower strike price.

This helps to discipline one’s own actions and avoid phases of exaggeration.


Only sell options on securities that you actually want to own!

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