There were more warnings: When you sold them early Feb BRK was probably around $390, so the $405 calls strike was just a tiny $15 = 3% above the then current price. I am not sure which posters warned against doing so, but definitely Maxthetrade did, and Bluehorseshoe (or somebody else?) even said he always calculates with a short-term run up of 10% and therefore sells BRK covered calls only with a +20% margin.

Greedy I myself violated this by selling on 29.Jan when BRK was at $385 calls with strike $420 = 9% margin --- but luckily after a small exchange with Maxthetrade heeded his warning, immediately bought them back and sold $430's instead. Even with that 12% margin the following time was very scary for me when BRK didn't stop going higher and higher.

So we both should learn our lesson and heed the warnings of those experienced guys, which for me is: Selling covered calls when I think BRK is close to the top of it's range: Yes! But: Ideally with a strike 20% above current price. If greedy: Only 15% above. But any lower than that: Potential suicide (at least if one loves his Berkshire shares).

Berkshire Hathaway FAQ

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