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Non-Tech : The Critical Investing Workshop

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To: alias who wrote (5305)2/27/2000 11:43:00 AM
From: Voltaire  Read Replies (1) of 35685
 
Alias,

I think the deep in the money was probably discussed in reference to buying calls as opposed to writing them, I know Jill and I were discussing this. One of the advantages of call writing is it's flexibility for almost any cash raising situation. For instance let us say that Porch Rat needed a little extra money to close on a home loan. He could go deeper in the money and raise immediate cash until he can find the funds elsewhere etc. etc. or use the margin account. Another reason for going deep in the money is because one may feel the market will correct strongly and therefore your losses will be less if that correction occurs.

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