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

To: Poet who wrote (6609)	4/17/2000 8:04:00 PM
From: Jill	Respond to of 8096

It's true, I had to buy back both the CNXT and GBLX April puts. Getting CNXT at 65 would not be very smart now! OTOH today's rally made me feel fairly hopeful about my other open put positions I had initiated, in JDSU a while back (June), Sebl a few weeks ago (May), and BRCM recently. Still, considering AFFX, CNXT and GLBX, puts have not been very good to me lately. I'm reconsidering their place in my portfolio. I don't think there is any one strategy that exclusively, but when a market tanks puts balloon just like calls do on the way up. And the margin capacity they hold can triple, quadruple, etc. I experienced in the last week how much that can screw you up, and you can't reposition unless you have enough capacity leftover, or cash leftover, to buy them all back. And then if you reposition out to the next year, your margin capacity is held for a long time. I knew all this but on a sudden crash like last week's it became a visceral, real experience--and I thought if worst came to worst and the dire predictions of 2700 or 2200 on the NAZ came true--I'd be royally screwed. I'll use them in the future but even more judiciously. Also ONLY on established winners. That's JMHO.

To: Poet who wrote (6609)	4/18/2000 9:04:00 AM
From: edamo	Respond to of 8096

poet..."one of us" but never a chaser of rainbows.... i made the comment due to a great amount of pm's received by those who thought the end would never come, and got hit heavily as they saw dotm call premiums go to zero along with long positions in the same speculative issues....those who post, especially if claiming "great success", and "their way is the only way", "never saw a call they wouldn't buy", need to understand that they feed into a euphoria that others jump into with both feet, and always at some point, even if it takes years, end up with burnt soles..... always remember, if you are going to boast of your anonymous accomplishments, it entails an ethical and moral fiduciary responsibility...... as far as "short puts"....closed some at a loss, cnxt being one, but if you go back a few weeks you'll see my posts going from 30 to 70 to 100% cash/no equities, replacing same with short puts.....result, depreciation of net portfolio value, but only to the point of early january...just gave up the parabolic increase since then... doesn't make sense keeping all in the market...better to take it off the table from time to time and buy "stuff" just be cautious...learn from the past, be conservative with any option strategies...speculation either on the buy or sell side is not a wise investment approach... don't worry, be happy...