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Strategies & Market Trends : John Pitera's Market Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: GROUND ZERO™ who wrote (1693)	5/23/2000 9:05:00 AM
From: John Pitera	Read Replies (1) \| Respond to of 33421

It really depends on what the implied volatilities are when the position is put on, as well as what the market actually does. The maximum decay in the premium of an option takes place in the last 45 days. So we still have most of that left for the June call that would be sold. I would probably not want to put the position on if I was looking for a large percentage move in one direction. I would want to have a level above and below our trading range where I would either unwind the position, An adjustment would be made upon a 40 point move above or below 1400, either a ratio write or if a trend seemed to be developing, then add a futures contract to benefit from the potential trend break, (it would depend on what the mkt looked like in terms of momentum and sentiment) I think it would be imperative to increase exposure to the long or short side break of 1475-80 or 1330ish. looks like the futures have cooled back off this AM. John