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Strategies & Market Trends : Selling Puts: Have Cash Will Travel -- Ignore unavailable to you. Want to Upgrade?

To: OX who wrote (866)	1/22/2000 11:23:00 AM
From: TheHahnz	Read Replies (1) \| Respond to of 1235

That's right OX, you get larger %moves with the cheapies, have greater risk and therefore get larger premies.. the stocks are lower priced because they have disappointed, story not yet recognized, and in general, just not the quality of the higher priced issues. My approach is to be short puts on a basket of these low priced stocks (many of which I've followed for years)and receive the 20-30% premie on 15-20 at any one time. This spreads the risk over many issues. It is interesting that of the pool of stocks that I follow, many have moved out of the low priced category. This seems to be confirming the flow of money into the small caps... Terry