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Strategies & Market Trends : Options
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To: Seldom_Blue who wrote (7475)5/5/2000 1:12:00 PM
From: Tom K.  Read Replies (1) of 8096
 
...Most people do not have the cash to buy the stock, so they have to close the position, hence lock in a loss....

When using a short strategy, be it PUTs or CALLs, I believe one has to manage the collateral requirements very carefully. If one trades this strategy without adequate cash, you can easily get sucked in with easy profits and then burned badly without warning.

P.S. I'm not innocent. I've been known to overextend on occasion and I've been singed.

Tom
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