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Technology Stocks : Lucent Technologies (LU)
LU 2.730-0.5%3:59 PM EST
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To: Ian@SI who wrote (16450)9/28/2000 9:23:53 PM
From: Georgeb  Read Replies (2) of 21876
 
Ok, you are right. I found hundreds of references to executing "covered puts". Everyone trading since 1993 and under 25 agrees: this is a "covered put".

Imagine now that you shorted the stock and wrote puts. The stock price climbs to $1000 per share. Your shorted stock has now completely wiped out your portfolio, your life savings, and any good will you had with your now ex-spouse.

But you had covered puts, right? So, no problem. You were wise enough to set up covered puts. You can huddle up to you covered puts in the street at night where you are now a homeless person.

I will take your advise to get out of the put business just as soon as I can liquidate the 72 puts currently written in my portfolio. <g>

These things have unlimited risk! To call them covered puts is a silly use of the word "covered".
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