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Technology Stocks : Dell Technologies Inc.

DELL 131.76

-1.1%

10:41 AM EST

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To: Uncle Frank who wrote (120517)	4/26/1999 9:09:00 AM
From: edamo	Read Replies (1) of 176387

uncle frank...margin and put sales.. as freeus learned the combo puts stress on a portfolio...in practice the put sale and cash derived from same is a means to tap margin capacity without borrowing...the sale of the put goes against your capacity..the proceeds are used to go long the underlying..same as if you decided to tap margin at a low point in your portfolio...fairly good timing of setting the position, allows a portfolio to grow with less risk and never any interest payment then a margin loan...margin loan never goes away even if you guessed correctly by buying an issue with an upward bias...put price always declines...unless stock is below your adjusted cost at time of expiration(strike-premium)..and then the risk is as you went long...but easier to close then an errant long position

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