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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: accountclosed who wrote (39285)	12/14/1998 6:21:00 AM
From: Tommaso	Respond to of 132070

I think I was talking about selling a particular stock short, and I believe that if I had meant buying a put I would have said that. But my limited experince with puts convinces me that the people who make the markets in them are usually going to be the winners there. I don't know what the takeout percentage might work out to be, but I would guess it's higher than a roulette wheel. With BEARX it seems to me there's a better chance because among other things, the fund does not expire like a put. Someone could be sitting on a bunch of puts that expire worthless and then watch the market drop dramatically, just when she or he can't afford to buy any more. As long as one has the money to put up for margin, one can also hold a short position in SPY indefinitely without the catastrophic upside risk of a single stock. Of course that does assume that the entire market will not double in a year's time. So it is still a gamble.