Subject: Re: On Charlie Munger's centenary, and albatrosse
Hi Jim,

One last thing on the options. I have a feeling that I've asked you this before but didn't save the answer. Do you have any guidance on writing covered calls on BRKB? Sweet spots in expiry dates and/or distance out of the money?

Maybe more to the point, how much extra can one get reliably?

You wrote:
What is more interesting to me is that there is no reason to believe that subsets of option trading are zero sum. I suspect that there is a long run net transfer of funds from buyers of options to sellers of options, though it may be modest.

I think it is a safe bet that there is a net transfer of money from non-market-makers to market-makers. Wannabee Market-Makers for whom this is not true would not last long.

Do market makers write more contracts than they buy? This seems likely and would seem likely to produce a better return to people coat-tailing the market makers by writing contracts instead of buying them. IF their inferior access to the right side of the bid-ask spread doesn't negate the advantage, which at my level of ignorance is a big IF.

Of course, it is conceivable that on something like BRK, call contracts are dominated by retail investors writing covered calls, in which case coat-tailing the market makers would tell you to buy calls.

Who knows.