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Strategies & Market Trends : IRS, Tax related strategies--Traders -- Ignore unavailable to you. Want to Upgrade?

To: Marc Lavine who wrote (570)	11/22/1998 1:31:00 PM
From: Kaye Thomas	Respond to of 1383

Marc, you make a good point, which I didn't think to mention because the original question indicated a concern only with pushing the gain to 1999 while protecting against a decline in the price of the stock. I recall that you were looking for a tax preparer who was expert in straddles and wonder if you found one. I'm thinking that even here in Chicago, certainly one of the straddle capitals of the world, you would have a hard time finding anyone with a more detailed knowledge of these rules than you already have. Kaye

To: Marc Lavine who wrote (570)	11/22/1998 5:03:00 PM
From: Spots	Read Replies (1) \| Respond to of 1383

According to McMillan, Options as a Strategic Investment (p 820), buying a put while long the stock does cancel the holding period so-far accrued for the stock, provided it is not already qualified for long term treatment. I believe the same is true for shorting against the box, though I can't put my finger on the reference at the moment. I wouldn't have called this a "straddle", BWDIK? I wonder if this holds true no matter what the strike, e.g., if one were to buy a far out-of-the-money put, thus retaining considerable downside market risk. There are such rules for covered call selling, for instance, to avoid a constructive sale interpretation.