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To: RealMuLan who wrote (55428)	8/27/2006 11:09:46 PM
From: Wyätt Gwyön	Respond to of 116555

naked put is exactly the same risk/reward as a buy-write (covered call where the long stock and short call positions are put on simultaneously). naked puts have a bad name because the margin requirements are low--that means you can sell a lot of naked puts compared to your acct equity, which is another way of saying you are given plenty of rope with which to hang yourself if you're not careful. a lot of people went BK selling naked index puts in the late 80s. it was a popular strategy right up until Black Monday in October 1987. the SPX fell over 20% that day and wiped out a lot of people. but if you only sell cash-covered puts, which you can do in an IRA even, the risk/reward is the same as buying the stock and selling CCs.