Selling Puts: Have Cash Will Travel Message Board

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Strategies & Market Trends : Selling Puts: Have Cash Will Travel

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To: Sam Citron who wrote (1188)	4/11/2000 10:44:00 PM
From: KFE	Read Replies (1) of 1235

Sam, You misunderstood what I wrote. I never said that QQQ options cannot be considered 1256 equity options. What I said was that I don't believe that they could be considered equity options. If they were considered equity options then they would not be 1256 contracts since only nonequity options can be section 1256 contracts. I believe that since they cannot be considered equity options then they should be section 1256 contracts. The section you quote from that lists dealer equity options is referring only to registered market makers and specialists on listed exchanges. The key to whether QQQ options are 1256 contracts or not depends on whether the Secretary of the Treasury designates them nonequity options or not. It is a disgrace that this has not been done by now. NDX options are nonequity options and are considered 1256 contracts. Since the SEC, and not the CFTC, has jurisdiction over options on stock indexes, they are Section 1256 contracts You have misinterpreted this section. The section you highlighted only applies to futures contracts. Regards, Ken

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