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Gold/Mining/Energy : Blue Chip Gold Stocks HM, NEM, ASA, ABX, PDG -- Ignore unavailable to you. Want to Upgrade?

To: Larry Brew who wrote (248)	10/18/1998 3:15:00 PM
From: John D. White	Read Replies (2) \| Respond to of 48092

Short 10 Nov 22 1/2 puts at $2 If stock closes above 22 1/2, I keep premium. Make $2000. If stock had closed below 22 1/2, I would have been "assigned" stock at 22 1/2 per share. My cost basis would be 20 1/2. When you short puts, the money hits your account that day. Your broker will generally require enough margin (buying power) in your account for you to pay for the stock at the strike price. The option holder may assign the stock to you AT ANY TIME. But generally will not unless deep in the money. It's a good way to "use" your margin without having to pay interest. Having said that. Shorting puts carries a lot of risk and is not the best way to get started in options. I would suggest selling covered calls. I also shorted the NEM Oct 30's when the stock got over extended. Made 3 points on them. could have made 8. Covered too soon. Oh well.