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Strategies & Market Trends : Options -- Ignore unavailable to you. Want to Upgrade?

To: Greg Jung who wrote (2546)	2/9/2000 11:27:00 AM
From: SecularBull	Respond to of 8096

Your point is understood. Thanks. LoF

To: Greg Jung who wrote (2546)	2/9/2000 11:53:00 AM
From: Jill	Respond to of 8096

Hi, Greg. They are different strategies but worth discussing together because in this volatile market on oversold conditions we often do both at once (or I do): sell puts and buy calls, because of an extremely bullish stance that the stock will soon recover with great verve. For instance, ed sold puts on BRCM and Poet did too when it retraced to 270s only about a week ago...it zoomed up to 350 or so I think...its retraced again to 330s earlier today...if I'd had my wits about me I'd have sold puts and bought calls then...I might not be able to buy a whole island like Pal's CMGI guy...but I'd be happy The point being that you have to allocate thus--not only risk, but how much margin collateral am I using up selling puts (and if it recovers mightily, that collateral will rise since the brokerages have their stupid formulas intact, so one needs margin room) and how much margin capacity will I LOSE by using my cash to buy calls, which will be margin-less. So it's worth discussing in one breath.