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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: mishedlo who wrote (258)	2/19/2004 4:13:06 PM
From: yard_man	Read Replies (3) \| Respond to of 116555

ok I follow -- for the futures, I know what a pt is there -- where is a description of the options -- one option control one futures contract?? that simple?? if I sell an OTM put for .10, I take in $25x10 or 250??

To: mishedlo who wrote (258)	2/19/2004 4:18:05 PM
From: mishedlo	Read Replies (1) \| Respond to of 116555

If I say I shorted 15 puts for 10 points that is 151025 = $3750 in short puts. I collected 10 points for Sept 05 94.50's My loss point is 94.40 (interest rates at 5.25% or so) Now you can also get 150 points off a single future. Just buy one sep 05 at 97.10 and if we do not hike it will tend towards 98.80 or so (170 points). $4250 per contract. By 5 and if we do not hike pocket $20,000 The short puts are nice cause you can win even if they hike but you have to do a lot of them. The only safe way to do lots of them is to go WAY OTM. If the fed started agressively hiking I would be screwed. However, if the first hike is not until SEPT or DEC then I would be OK anyway due to decay and the impossibility of hiking 4 points in a single year. A nice combination of short puts and futures works nice. M