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Non-Tech : Tyco International Limited (TYC) -- Ignore unavailable to you. Want to Upgrade?

To: fellowfool who wrote (692)	11/15/1999 11:04:00 PM
From: Chuzzlewit	Read Replies (1) \| Respond to of 3770

FF, I think I approach put selling somewhat differently than you. When I sell a put it is with the full intention of having the stock put to me. Therefore, I look at the effective price I would have to pay for the stock and ask myself whether I think that price is reasonable. In essence, I generally view the sale of a naked put as a variant of 'good till canceled' order where I am paid for the privilege! In other words,it is not really a trading strategy so much as an adjunct to my investing strategy. Regarding volatility: I download historic volatilities from the CBOE site, and compare the average volatility of the stock over the last seven or eight months to the implied volatility of the option I am considering. If the IV is equal to or greater than the historic volatilities I feel comfortable in selling the option (either a call or a put). Some traders use the complementary approach for the purchase of options -- when the IV is less than the historic volatility they buy options. TTFN, CTC