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Strategies & Market Trends : Waiting for the big Kahuna -- Ignore unavailable to you. Want to Upgrade?

To: Jodi Segal-Lankry who wrote (10815)	12/3/1997 7:29:00 PM
From: William H Huebl	Read Replies (2) \| Respond to of 94695

Hi Jodi, Boy do YOU have a basket full of issues in THAT post... but it is absolutely GREAT that you asked... some people are too afraid to ask questions like that and I KNOW you will get responses on this one. Lets take the last first... this is your first options play... GET HELP! I would highly recommend books and especially something like Bernie Schaeffer's IRI subscription for 2 years... comes with a cassette tape and some REALLY informative booklets. I wrote down EVERYTHING HE SAID ON THAT TAPE. I recommend you do likewise... you wouldn't be holding S&P puts if you did! The puts are valid up through the close of the trading day on the 19th and I believe you can exercise as late as Saturday... but I am not sure about THAT one... you might check your broker if you have one. And lastly, you used the word CRASH... I can tell you, when I first started trading options, I saw a crash around every corner... I DID make a few bucks in the 89 sell-off... BUT I HAVE PROBABLY LOST UPWARDS OF $100,000.00 WAITING FOR THAT ELUSIVE CRASH. Please, oh please do NOT make the same mistake. YOU NEED TO GET A GOOD FOUNDATION IN TA... My read on the market DOES include a strong sell-off in the markets by expiration... but whether you can benefit from it depends on too many things which are as yet undetermined... like how bad a sell-off is coming??? I hope that helps a litlle bit. "There are old options traders and there are rich options traders, but there are no old, rich options traders!" That expression comes from WS and not from me... so take heed... Regards, Bill

To: Jodi Segal-Lankry who wrote (10815)	12/3/1997 9:37:00 PM
From: P.Prazeres	Read Replies (1) \| Respond to of 94695

sell your puts... unless Iraq invades kuwait or saudi arabia, the market isn't goint to crash. Paulo

To: Jodi Segal-Lankry who wrote (10815)	12/3/1997 9:58:00 PM
From: Bilow	Respond to of 94695

My first option purchase returned 10x in three days. (They were short expiration calls on Symantec when it became clear that they were stealing people and intellectual property from Borland.) This is the traditional result from a first options purchase, so best of luck. :) After that, the options gods come, grant you tons of hubris, and then soon take your premiums away. :( Before you buy an option, you really need to know what it's value at expiration would be under the assumption of various values of the underlying security/index/future. Here's a hint. To compute how much your options will go up in the event of a sudden change in the underlying asset price, look at the option prices for the options struck around your own. You might, for instance, look at the value of options with strikes of 90+8 = 98, if you were expecting a $8 (i.e. 80 point) move in the S&P in your favor. That gives a reasonable idea of the change in option price given a change in the S&P. But options also lose value as time goes on. The time premium (value above the execution value) is supposed to decrease proportionally to the square root of time remaining. -- Carl