To: IceShark who wrote (53146 ) 1/3/2001 9:30:52 AM From: accountclosed Read Replies (1) | Respond to you know, i need to get more of the details. but these guys simply did not take naked positions. it was very strict, go home flat and take the vigorish off the table. i was closely involved when they got started. i read natenberg's "options volatility and pricing strategies" with them. they were constantly monitoring the flatness of their positions in all respects. i can't recite the various greek letters assigned, but i think you know what i mean when i say they were monitoring their risks from all directions. later, they branched out from floor trading to being the specialist firm in the options on the floor of phlx. again with the same strategies. it was a very lucrative biz. and everyone was well aware of people taking even layup naked positions and losing their shirts. there was a friend of theirs/mine that took a huge naked position that was 99.9999999% likely to suceed and went bankrupt when the underlying stock issued like a 90% dividend (as a percentage of the market value of the stock).
