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To: Trading Machine who wrote (7556)	1/21/2000 9:32:00 AM
From: Gersh Avery	Read Replies (2) \| Respond to of 11051

Da seller sings "time is on my side."<g>

To: Trading Machine who wrote (7556)	1/21/2000 12:35:00 PM
From: MonsieurGonzo	Respond to of 11051

TM> LEAPS... > all the options I have so far are leaps > and what I am doing is buying about $2K > per week and building a pipeline... ...sounds very similar to what DJ does, and he has been very successful holding LEAPS. Selling PUTs limits the upside - I like to short PUTs when a stock gets hammered down below some EMA and options boundary; ie., obviously short-term oversold - the VIX.X - Volatility is high. otoh DJ likes to buy LEAPS when the volatility is low, and growth is evident, iirc. Yesterday, BPA - BPAmoco ADR was a good example of a short PUT trade, Paul. Look at the chart - you'll see it collapsed to fill a gap, made a doji - indicating a probable gap-up open on the FTSE carried over to +1~2 point pop on the NYSE. We could have sold BPANK - BPA Feb 55 PUTs yesterday for around ~2.125 and bought them back today for ~1.5625 gaining about ~0.5625 or +25% for this trade. We had soaring CL00H - CrudeOil and high implied volatility in our favour. The interesting part is that - if BPA did nothing - that is, it just stayed there at ~55 today - we would make money because: (1) the implied volatility built in to the premium would go down; and, (2) the time value decay built in to the premium is also going down every day - and as option sellers this is in our favour ;-) There's no growth in short PUTs, though - they would be appropriate for "pops" like (the above example, and) what you were describing the other day, not for leveraging growth like DJ does. -Steve