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Strategies & Market Trends : Rainier's Column

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To: HeyRainier who wrote (21)3/10/2000 3:24:00 PM
From: HeyRainier  Read Replies (2) of 106
 
Quite a tradeoff between risk and reward. Today, I opted for the lower risk but subsequently capped my reward when I wrote puts for Qualcomm when the stock traded at $123. Had I opted for the equity, that would have been an 18 point upside for one day. Oops, make that 19. Instead, it was capped at about 3 points.

The flipside to this is that I probably would not have even participated in the issue had I not had the assurance that I would have my backside covered with the premium proceeds.

Oops, make that 21 points.

The tradeoffs we make for higher probability returns.

Rainier
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