Options for Newbies -(Help Me Obi-Wan-Kenobe) Message Board

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Options for Newbies -(Help Me Obi-Wan-Kenobe)

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

To: Madpinto who wrote (754)	3/3/1998 11:45:00 AM
From: Chip McVickar	Read Replies (1) of 2241

Micheal -- Question on far out Dow Index Puts What are the pros and cons of using far out puts on the Dow Index as a conservative strategy in protecting a portfolio from significant loss..? For argument lets say I have a $200,000 portfolio of 15 mixed securities, held for many years and are not willing to sell...make no attempt at market timing.....just buy on the significant pull backs of good companies like GE and Pfizer, etc. One is Not looking for quick profits from DJIA retreats of 10%, but are more concerned with 20/30% declines and providing a type of insurance equal or close to the amount of possible loss. For instance the WSJ has a DJX Sept 92p selling for 7 3/8 and another DJX 84p selling for 3 3/4.....there may be others farther out and not listed in the paper. Would the use of puts well out in time....provide an economical way of protecting this $200,000...if they were rolled over from time to time..? What are the rules for buying and managing Puts in this manner..? What are the risks envolved..? Can you help me understand the process of using these type of investments. I hope this question is of some interest. Thank You Chip

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next