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Strategies & Market Trends : Win Lose or Draw : Be A Steve, Make A Call -- Ignore unavailable to you. Want to Upgrade?

To: farkarooski who wrote (6239)	3/12/2003 11:34:02 AM
From: mishedlo	Read Replies (2) \| Respond to of 11447

Let's take a look at IBM. I bought July 75 puts for 5.80 On a swoon down the other day I sold March 75 puts for 1.70 My July's are worth 2.60 but the March puts are worth 1.95 (so I am .80 ahead on the July puts) and lets say .30 behind on the March puts. But if we were to expire right now, those March puts only worth about .40 so I would make big profits both ways! Time is my ally on this one and it will chew up premium on IBM if we flop around a bit. I lose addtional profits below (75-1.70) and a rally will decrease my gains on the long puts but then I will pocket the $1.70. As lond as we stay below about 78 I think I make $. Perhaps even higher but I do not know. A close at 75 or so would be perfect. Big win each way. If we do that I will write Apr 75's or Apr 70's and pocket more $. Perhaps I can do this every month until July. Wouldnt that be nice for me! M