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To: yard_man who wrote (101907)	5/13/2001 11:19:38 PM
From: LLCF	Respond to of 436258

<If it crumbles in the next six months you will have overpaid and underleveraged yourself to the decline -- that's all> Yes, it's the timing or course, if it happens 9 months or a year out then you will have overpaid for those near terms and will be underlevered in that later decline relative to the LEAPS. DAK

To: yard_man who wrote (101907)	5/14/2001 12:14:56 AM
From: mishedlo	Read Replies (1) \| Respond to of 436258

Tip - That is it in a nutshell But is it over-paying or just being cautious? Consider MSFT right now. Max pain is at 60. Strike 65 may puts are a mere 35 cents. If MSFT falls to 60 this week, how many bags is that. Now if it does do that, did someone who bought the June 65's Overpay? Or was that person willing to accept less rerward for less risk? If MSFT falls to exactly 65 by expiry the person who bought Jun 65's certainly did not overpay. In fact the timimg was 100% perfect. If however, MSFT drops to even as low as 63 the person who bought June 65's overpaid by your way of thinking. Crap. If I was GUARANTEED to be right, I would be perfectly happy with a 100% gain (even if a 400% gain was possible with better timing). Put the whole damn thing on FNM PUTS and collect a 100% gain in a year and 1/2. I would settle for that in a flash if it was guaranteed. M