Silicon Investor (SI) -- The First Internet Community

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.

Non-Tech : QQQ - Nasdaq 100 Trust -- Ignore unavailable to you. Want to Upgrade?

To: Wando who wrote (110)	9/7/1999 12:20:00 AM
From: Bill on the Hill	Respond to of 840

For those trading in QQQ - Princeton NASDAQ composite. Shows trend. DAILY - WEEKLY - MONTHLY peicommerce.com

To: Wando who wrote (110)	9/7/1999 7:10:00 AM
From: Mike Gordon	Read Replies (1) \| Respond to of 840

Wando: There are several ways of covering yourself using options. I tend to use simple strategies. For instance, to cover my short position, I will sell September 120 or 121 puts. Using Friday's prices (which are now overstated due to the 3-day weekend) I might receive the following: Sell Sep 99 120 Put Receive $1.0625 or Sell Sep 99 121 Put Receive $1.1875 Because I received cash for the sale of the put (Sep 120), I have raised my short position by $1.0625. Because I am short at $119.50, I received the credit making my new short position now at $120.5625. At risk is the following: If QQQ tanks to less than $120, I must purchase QQQ between now and Sep 17. My profit resulting from my short position is limited to the difference of $120.5625 and $120. If QQQ remains above $120 between now and Sep 17, I keep the proceeds from the sale of the put and remain in my short position. I now have the ability to sell the Oct 120 put at $3.125, again raising my short position to $123.6875. Before I enter into an options position, I will watch closely the MSFT, INTC, WCOM, DELL, & CSCO as they represent 39% of the 100 Index. Wando, this strategy locks you in until options X day. While it limits your losses, it also limits your gains. If you believe that we will see a retracement in the next few weeks, you might want to wait this out. Let me know if I can help, Mike