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To: Marq Spencer who wrote (111930)3/24/1999 8:21:00 PM
From: edamo  Read Replies (1) | Respond to of 176387
 
marq...re: put selling strategy..

true if you analyze it as non moving position...in reality the dynamic favors the strategy for as the underlying increases in price, the put value decreases, crank in time erosion and depending on the amount of the upward move you can cover the profitable put long before expiration, reset the position, not increase exposure, go long with the additional premium...as if you were margining on the way up...only you own the stock and your original exposure is no different...to add to shares with the long only premise you must either use margin or add cash...think the dynamic through...not to mention the benefit of call selling as your long position shares accumulate...you are rolling your capacity several times a year and reinvesting, growing capacity...it truly works...ed a.



To: Marq Spencer who wrote (111930)3/24/1999 9:11:00 PM
From: PAL  Respond to of 176387
 
Marq: excellent analysis. I was going to beat my brain, but you have solved the problem in a clear systematic analysis.

Thanks

Paul