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Strategies & Market Trends : Contrarian Investing -- Ignore unavailable to you. Want to Upgrade?

To: fedman who wrote (411)	10/2/2006 10:19:51 AM
From: pcyhuang	Read Replies (1) \| Respond to of 4080

fedman: Simply because writing naked call options is a very dangerous game, I don't recommend it to most investors. You must realize that the risk in selling naked call options is unlimited. Writing naked puts against cash on the stocks you won't mind holding is totally another matter. At many brokerage firms, writhing naked calls is considered the highest risk strategy in the trading of options. One alternative you may try is to do bearish call spreads: that is, selling the lower strike option while simultaneously buying the upper strike one. The profit potential is limited but the risk is also limited to the difference between the two strike prices and the net credit premium that you have received. pcyhuang