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Strategies & Market Trends : How To Write Covered Calls - An Ongoing Real Case Study! -- Ignore unavailable to you. Want to Upgrade?

To: Jeff Meek who wrote (12126)	12/29/1999 11:43:00 PM
From: OX	Respond to of 14162

Brown's NP margin policy is inline w/ the CBOE's margin manual (so is the broker I use--PCM). Brokers can tighten those policies. The margin is generally between 10% to 20% of the underlying plus the prem rec'd. IMO overleveraging is generally not a good idea. It is unnecessary if one has reasonable goals. QCOM: it still has a few days before it gets to its 1K target :-) ... at least there are some fundamentals there unlike some momo stocks.

To: Jeff Meek who wrote (12126)	12/31/1999 1:06:00 PM
From: Tom K.	Respond to of 14162

...Your broker's requirement of 20% of the underlying seems very low.... Jeff, I fibbed a bit. Staying with OTM PUTs you can get the collateral requirements down to only 10%. Like OX pointed out, these are authorized levels. Now if your question is do I extend myself to the hilt and leverage everything, the answer is no. My target is only a 30% annualized return on my base so I don't have to take crazy chances..... but, I am clearly leveraged. By the way, I closed my QCOM PUTs yesterday for $15,000 in 4 days.... nice, but a far cry from those that rode the CALLs. I tried to do some more PUTs today, but couldn't get good prices on the web due to the split. The codes didn't seem to work and CBOE was too slow. Happy New Year and good trading in 2000. Tom