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Technology Stocks : Dell Technologies Inc. -- Ignore unavailable to you. Want to Upgrade?

To: freeus who wrote (62643)	8/31/1998 5:39:00 PM
From: Lee	Read Replies (2) \| Respond to of 176387

Hi Freeus,..Re But you have to realize I'm very long on Dell and did not expect it to ever get down to levels where my margin would be in danger Freeus, I'm not questioning any action on your part. Only trying to understand the use of margin. In trading futures (options), the main and inviolate rule is get out when the market moves against your position (guard capital at all costs) and set a trade goal/profit objective and stick to it. THat's why I was wondering if I decided to open a margin account wouldn't one operate that account with the same rules as futures trading? The questions arose because the topic of margins has increased significantly in proportion to the sell-off. Regards, Lee

To: freeus who wrote (62643)	8/31/1998 9:12:00 PM
From: Don Martini	Read Replies (1) \| Respond to of 176387

Hi, Freeus, Consider selling calls to cover the margin call. Example: 1,000 shares margined at $125 Buyer and margin dept each put up $62,500. Dell drops to $100, if you sell it you lose $25,000 forever. Instead: sell 2001 leaps, [120 strike] for about $35,000. This will keep the margin guy happy and prevent a loss. I sold ten $130 puts, 2001 leaps @ $37.50 Today sold the 130 calls @ $35.00 Now have $72.50 in premiums to apply to $105 shares, net cost 32.50. If it's called away I'll get $130 = 400% of net cost. Breakdown: stock cost $105 less 72.50 = $32.50. Call strike = $130.00 Of course, the puts can be exercised for $130 in the future. The new shares will cost me 130 less 72.50 = 57.50. Then I can sell more options, get more premium$, end up with free stock. If you need additional info let me know. OK, Freeus? Sorry to see you sad. Don Martini