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Politics : Idea Of The Day
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To: Jerry Olson who wrote (17900)4/13/1998 3:42:00 AM
From: IQBAL LATIF  Read Replies (1) of 50167
 
OJ-off topic
Hi- risk-- my kind of strategy- this is how I will play this market.

Heavy selling of SOX puts like 220's Oct and buying June 280's 2 to 1-- if INTC and next two quarters disappoint let these long put positions run until we see 248 -- leg out from long positions at 248 expecting a recovery from lows of 243-- even if it breaks 243- 220 is a safe bet well outside. However if market runs up from here you don't lose much as premum lost in long puts will be compensated by erosion of shorts 220's premium. Calender spread will make this a neutral trade. This is only recomended if you really don't see SOX below 220- for additional safety you can throw in some additional money to purchase protection like SPM 1030 long puts. In case if markets break thru key supports like nine pins. You can apply the same trade for INTC instead of 220 use 50 puts and but instead of 280 calls 65 puts. You are in the game with only risk that the market as a whole moves in a bear phase for that I am proposing some SPM cheap puts. Let us follow this trade on paper and see what happens after INTC. This is the trade I will place, so for me it will be an actual trade. In three months I will post my results. I will long 20 contracts and short 40. I will also throw some money on 5 contracts puts long SPM, to protect if all hell break loose. 40 SOX short is 1.4 m $ 5 long SPM will be 1.25 m $ plus my 20 longs puts at 280 gives me ample cover from a disaster. Complicated deal but I am sure will stand test of markets.
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