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Politics : Idea Of The Day -- Ignore unavailable to you. Want to Upgrade?

To: steve susko who wrote (21332)	11/11/1998 4:50:00 PM
From: James C. Mc Gowan	Read Replies (1) \| Respond to of 50167

IKE: re: IIX and TBR/Brazil situation Latest reports on TBR thread indicate Brazil legislators are not showing up for meetings which were scheduled to move the Social Security reform package, part of the Cardoza belt-tightening efforts. I've read various reports that the Sao Paulo, Rio, et al. governors control legislators from thier district and some are opposed to drastic economic tightening moves. You mentioned best short term insurance would be IIX puts and puts on TBR, in the event of some general US market decline. Today the internets took a hit, and yet, IIX puts are, as usual, very pricey. Do you have any suggestions for modest cost downside protection to allow for continued holding of longs?(and still allowing sleep at night,ggg) I really appreciate your discussion re: taking a % of your profits to protect from short term declines. You have a much larger account than I, I'm sure,ggg; but does the rule of thumb of 1% cost of protection apply, regardless of how much you want to protect? I find the approach of buying protection with puts on the most volatile issues(e.g., IIX, Emerging Market bellweathers like TBR) intriguing. Maybe sometime you could expand upon your thinking as to how you select candidates for protective puts. Thanks again for sharing your knowledge vocex