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

To: taxman who wrote (926)	1/23/2000 10:53:00 PM
From: Tom K.	Read Replies (1) \| Respond to of 1235

...don't you have an obligation to sell dell until may at 40 which would cost you money (say 4.25 or so) to get out of?... There are some basic concepts that seem to be confusing. I am short the May DELL 40 for which I've received 4.25. This is all time premium which will evaporate as we get closer to May and I'll just keep it. The only one I'll give it to is my wife. Until May, I do not have an obligation to "sell" DELL, I have an obligation to "buy" DELL at 40. If it continues to drop, I'll roll my obligation down to 35, then 30, etc. so that I really never have to buy it. Hope that helps. Tom