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Strategies & Market Trends : Point and Figure Charting -- Ignore unavailable to you. Want to Upgrade?

To: Dennis J. who wrote (10612)	12/1/1998 7:47:00 PM
From: Judy	Respond to of 34809

Hi, dennis ... owning leaps costs a bit more than buying on margin, but it also gives one 3-4 times more leverage. On a probabilistic basis if one tends to be adequate in stock selection and timing of entry, leaps would be better from a risk/reward perspective. But buying shares on margin would be the safer alternative. There are many ways to finesse a long-term options position, spreading calls against them can be protected if one also ladders into leap calls a few strikes higher as they are cheap while the stock is in the doldrums. These will protect your position when you sell calls against the orginal position over the course of time.