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Strategies & Market Trends : Tech Stock Options

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To: john c. cona who wrote (2099)	5/30/1996 1:05:00 AM
From: Snowshoe	of 58727

YOU BET! They will let me buy options to the maximum of my margin account! But the brokers are not only concerned with my risk, they are concerned with their own. Because with uncovered options, they could be stuck if I didn't have the assets to cover a major loss. That's what happened to some brokers in '87. After that, margin requirements were tightened. (Part of the problem in that instance was with index puts, which are always settled in cash. If stock is put to you, there is a good chance that it could bounce back real quick.) I agree that based on probability theory, selling options is less risky than buying, if you understand the risks and manage your money well. However, weren't you the one who lost 2 1/2 years of profit on put positions back in '90 when the market tanked?

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