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

To: Poet who wrote (5996)	4/4/2000 8:06:00 PM
From: SecularBull	Respond to of 8096

ONLY in that they are both bullish strategies. Regards, LoF

To: Poet who wrote (5996)	4/4/2000 9:00:00 PM
From: Jill	Read Replies (1) \| Respond to of 8096

Hon, I think he means the risk profile is different. They may both be bullish strategies, but when you buy a call you can only lose your investment--and you can lose ALL your investment of course. Especially on short term calls. When selling puts, you are the writer so you have the chance to respoition, but theoretically you could be put and have to ante up the $, or you could have a case like AFFX. As you and I discussed today, I thanked you for your advice to GTFO a ways back, when the stock started to plummet. The high just a few weeks ago was 320, and I the low today was 107. It closed today at 125 or so. Now, if you for some reason sold puts at the high for instance, or even when you thought it was oversold by its then trading range, you'd be mighty underwater now. If you'd sold a bunch, you'd have to reposition WAY out to ride out volatility. So you'd tie up margin capacity for a good long while. You could probably work your way out of it but it would be one big hassle. And btw I still think it's a really neat company. :-)