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Technology Stocks : Full Disclosure Trading -- Ignore unavailable to you. Want to Upgrade?

To: Sam Citron who wrote (9239)	8/24/2004 9:41:36 PM
From: Return to Sender	Read Replies (2) \| Respond to of 13403

OT: Thanks Sam. I'm still not sure I understand. You might have to buy 1000 shares of LGND at 10. But you don't get to decide if you will have to buy the shares tied to the puts? LGND closed at 9.97. I'm still trying to understand so please be patient with me. You just got paid 2K to sell those puts. A position that potentially ties you into buying 1000 shares of LGND at 10 but you are not entitled to any profit above 10? These are essentially in the money puts. If in the next 6 months LGND goes below 8.02 you would be losing money. However you do not own the puts so you cannot decide to cover them. The owner of the puts you sold them to gets to make that decision. I looked at the long term chart and see very little chance that LGND would trade below 6 for too long. But it sure looks like it could go there to me. If however LGND trades above 10 though you are not entitled to any of that profit since you already banked 2K. As I understand it you sold LGND @ $10 naked puts. You do not already own the underlying stock? What am I missing? RtS