VOLTAIRE'S PORCH-MODERATED Message Board

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Strategies & Market Trends : VOLTAIRE'S PORCH-MODERATED

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To: im a survivor who wrote (32569)	3/7/2001 12:17:57 PM
From: RR	Read Replies (1) of 65232

Hi Keith: 1.) You know what I'm going to say first. Preserve capital is rule 1. You didn't do it. Lesson learned. 2.) Don't ride calls you're holding into the dirt. When the position turns against you, get out. Discipline. No emotions. Don't fall prey to the notion "It will come back." 3.) RMBS has to go up 76% by May exp from here for you to get that dollar. Same analogy as Ed used. Doubt it will happen in this market. Time is running. You are roughly 70 days out. I usually close my calls well before 60 days before expiration. Time erosion factor.... 4.) If it were me, I'd probably take the buck and run now. At least get something out of them, even if it's just a buck. On the other hand, you might get a little bump up on the Fed news/anticipation in the next couple of weeks, then get out. However, time will have whittled away at you even more by then, and, frankly, I doubt those calls would respond too favorably to make that much difference anyway being so far OTM with a May expiration. Good luck. RR

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