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To: Ron McKinnon who wrote (19363)	2/28/1999 6:15:00 PM
From: tom pope	Read Replies (3) \| Respond to of 53068

Ron, what I was looking for was a way to generate something north of 10% pretax with a one to two year horizon on the basis of the credit of a well rated institution such as Solly, Goldman or Merrill (I never know whether Merrill takes one L or two). I don't know what the market's going to do over the medium term, but if there is such a thing as reversion to the mean, then perhaps 10 - 12% may start to look good, especially in an environment where risk free (i.e., full faith and credit of the US gov't) 2 year paper yields 5.2%. So my idea was to buy one or other of the equity-linked notes that was trading very close to its floor and write S&P medium term calls against it. If the index was down, flat, or flattish, my idea was to roll over the calls to another 9 month to one year out at-the-money strike. If it was up, sell the note, buy back the call, pocketing the premium, and look for another equity-linked note with a floor near the current index price and start the process over again. With OID type imputed income the thing becomes less attractive, and the call feature is another downside - even if the note is not callable for some years, the callability will put a ceiling on the price of the note without any ceiling on the call that's been written. The ordinary income feature of any disposition is also a disadvantage. I think I've become very long-winded when all I was trying to say was that putting a part of my assets at this time in an assured 10% yielding investment seemed attractive to me. (My problem with spelling Merrill is like the circus owner who needed two of the animals known a mongoose for a new act, but when he sat down to put in the order with his mongoose supplier he couldn't figure out whether to order two mongooses or two mongeese. So he compromised by e-mailing: " Please send me a mongoose. And while you're at it, send me another.") Like I said earlier, it's been a lazy Sunday.

To: Ron McKinnon who wrote (19363)	3/1/1999 6:50:00 AM
From: AnnaInVA	Respond to of 53068

f one has a great deal of patience it would seem to me that you could wait, wait, wait for all the stars to line up with 90% probability pick your spot jump in big time take a % gain go back to the cave with my type A personality I never have nor likely never will try the about hit and run tactic << Ron, you and I have about the same personality. No patience. Gotta do something NOW, etc. Yes, the above can be done. Just look at the charts. The market tends to go down around July and again around October. Hold cash and when your favorite stocks hit your mental bottom, jump in, double and triple and go back to watching "As the Stomach Turns" .... grin ... Anna