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

To: bearshark who wrote (18714)	5/19/1998 12:57:00 PM
From: Haim R. Branisteanu	Respond to of 94695

Would like to bring to the tread attention a bear spread on SUNW. SUNW is trading 42 to 42 1/4 Buy SUQRI for 3.5 = 350.00 Stock equivalent $41 1/2 Sell SUQRA for 1 7/8 187.50 Stock equivalent $40 5/8 Debit 1 5/8 162.50 If stock closes at or below 43 1/4 at expiration you make money. Your upside is limited to $250 on a $162.5 investment As we anticipate a rally and then a reversal you can collect the premium on the SUQRA and go plain long SUQRI and take more risk but more upside I am sure that such discrepencies exist also in other stocks. You can always hedge by going long below $43 in this exaple and end up with a wash in a 5 contracts transaction. Haim

To: bearshark who wrote (18714)	5/19/1998 1:35:00 PM
From: Defrocked	Read Replies (1) \| Respond to of 94695

Fed has done several studies on past changes in margin requirements but has found no predictable effects (if my memory still serves me <g>.) I don't think they'd go that route. Regarding reserve requirement changes, such a policy alternative would indirectly increase cost of funds but acts on an already uncertain money multiplier which could introduce further distortions for policymakers currently scratching their heads about money supply growth. In contrast, open market operations are generally more flexible, can be given guidance, easier to change and more acceptable to the banking community. I'm looking for No-Action from the Fed today.