Portfolio Protection + Money Management for the Long Term Message Board

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Strategies & Market Trends : Portfolio Protection + Money Management for the Long Term

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To: BDR who wrote (19)	4/10/2000 10:04:00 AM
From: BDR	Read Replies (1) of 57

Instead of buying puts on an index for protection, let's look at the cost of buying puts on an individual stock. JDSU has become my largest single holding so I will use that. JDSU 121.50 (Shortly after the open) 800 share = $97,200 (to approximate the $100,000 portfolio in post #19) June 100 Puts $11.125 (Strike of 100 chosen to protect about 85% of the asset as the 90 strike price did for QQQ in #19) Cost of 8 puts = $9000 plus commissions. More expensive than the index puts but then the index position may need to be adjusted to reflect a higher beta of JDSU. I don't have the answer yet. I am just doing back of the envelope calculations here and putting them up on the thread for comment.

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