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Strategies & Market Trends : MDA - Market Direction Analysis -- Ignore unavailable to you. Want to Upgrade?

To: westes who wrote (52139)	5/25/2000 5:45:00 PM
From: pater tenebrarum	Read Replies (1) \| Respond to of 99985

W, the depository receipts contain, or represent,all the index components. i strongly advise you to read up on this on the Amex web site...the process of SPDR creation and composition is described in detail there. instead of shorting all the components of the NDX, you simply short the QQQ, which is valued at 1/40 of the index per unit. you can hedge this position with calls...a method i frequently employ in order to minimize the risk. the spreads on the QQQ options are most of the time also pretty wide, not because they are illiquid (they are not), but because the MM's are criminals and the QQQ is very volatile. i have usually no problems though to get executions between the bid/ask on limit orders. regards, hb