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

To: jhs565 who wrote (1095)	2/5/2000 12:26:00 PM
From: OX	Read Replies (1) \| Respond to of 1235

first congratulations on your profit. I would venture to say there aren't many who play very DITM LEAPS NP's (for the short term) as you did. It's counter to the old adage of 'sell time value, buy intrinsic value'. In your situation, IMO you exposed yourself to more risk than you needed to for a short term play. I don't know qcom's price when you sold your puts, but on 1/26 qcom was anywhere from (approx) 120 to 131. the prem rec'd only 'protected' you down to 120. I'm pretty sure you could have a sold nearer term ITM puts (Feb, Mar, or for better risk-reward, Apr's) for more downside protection and (most likely) just as much (if not more) ST profit potential. (or sold similar closer ITM JAN01 for less profit potential, but also for more downside risk protection) I think others on this thread would be interested in knowing how you came to chose YQOMD and what your price targets were at the time. Thanks for posting your trade.

To: jhs565 who wrote (1095)	2/5/2000 9:45:00 PM
From: Tom K.	Read Replies (1) \| Respond to of 1235

...Anybody trading (short term) LEAPS PUTS?... John, thanks for sharing your QCOM trade. Like OX, a DITM PUT is not my style. However, as a side line to my short term strategy, I do keep a few short OTM LEAPs on the back burner on stocks that are solid (same ones I use for short term trading). Because they have nice premiums and are outside of my regular process, as they become profitable, I close them whenever I need an extra hit to make my monthly numbers come in on target (or better). For example, last month (Jan) I sold TYC Jan01 35 PUTs. The trade is now $10K to the good, but I won't close it right away. I'll wait until I need it and treat it as a bonus. As long as it stays above 35, the position will continually increase in value during the year and I'm protected down to 28 if it should drop. So yes, here's one person that trades LEAPs short term as an adjunct to his regular process. Tom