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To: taxman who wrote (370)12/30/1999 9:11:00 AM
From: edamo  Read Replies (1) | Respond to of 8096
 
taxman...re qcom puts/calls

i don't think that you will ever find where i posted that selling a qcom put better then going long common or buying a call. put selling is a strategy to enhance one's portfolio in issues that they own or desire to own at a below market price. it allows you to participate in an up move, and not use margin borrowing.

your comments addressed high risk/low reward in the strategy, that is what i disagree with. it is a very conservative way to obtain or add to a position, and if you guess wrong you've added a percent gain in the area of perhaps 10% per month on your existing cash or capacity.

buying dotm calls a much riskier strategy.

per harrison roth:

"writing puts has been an underutilized strategy. it is similar in nature and risk to covered call writing but offers higher returns. it was (mistakenly) thrown into disrepute in the wake of the 1987 cataclysm. despite that, with leaps it is an appropriate strategy for many who understand its risks. it can even be done by very conservative investors. writing puts with leap stocks deemed attractive combines a good return with an acceptable risk.

but you and grif are the "pros"....