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Strategies & Market Trends : Advanced Option Strategies -- Ignore unavailable to you. Want to Upgrade?

To: wilander who wrote (129)	8/12/1998 1:00:00 AM
From: Don Martini	Read Replies (2) \| Respond to of 355

Wilander, Hello! 1. Advantages of puts: A. You can win if the stock doesn't move, or if it drops a little B. You can roll them out, bring in greater premium if they go south C. Your profit point is always lower than with calls 2. It's better to know a few stocks well than many partially One stock can make you rich. I don't believe in second tier stocks. 3. Dell has made me more money than any other issue. It gained 9,200% in 5 years. I've always got a hundred or so puts and calls going on Dell. Here's an example: Recently I sold Dell 8/120Ps for 13.25, bought them back today when it looked like we were going to see another nosedive for 15.25; lost 1.75 per share. What to do? I rolled out the 8/120Ps to 00/120 Leaps for $32.00 and sold 8/105Ps for $4.50, bringing in $36.50 total. Allowing for the 1.75 loss I'm 34.75 ahead, including the original premium of 13.25. If Dell dips I can roll out the 105s also. My new breakeven is $85.25. Later, if necessary, I can roll the year 2,000 leaps to 2,001 as my back is not to the wall. 3&4. I'm a private investor, not an investment counsellor, do not make recommendations as to specific plays or stocks. I hope you understand, wilander. My best to you! Don