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To: His Pinkness who wrote (112021)	3/24/1999 11:25:00 PM
From: edamo	Respond to of 176387

his pinkness...where do i trade...more like where do i invest!!! to sell puts you must have a margin account...the puts sold are against your current margin capacity, with adjustments made for premium and in/out of money...your brokerage should include in margin calculation not just cash but any normally marginable security. i use a full service brokerage, morgan stanley dean witter, have my own personal broker which any serious investor should have..have choice of negotiated commissions or flat quarterly fee...not much more than a discount broker charges..especially on options..i'm able on a regular basis to sell puts to the value of my portfolio...as the portfolio grows so does your capacity..... compare to margin..you go long, long appreciates, you borrow against margin...on and on until a reversal, stock drops...whoops sell puts, premium adds to capacity go long, more capacity, more puts,more long...capacity grows, positions accrue and if done properly your put exposure remains static...good luck, ed a.

To: His Pinkness who wrote (112021)	3/25/1999 1:59:00 AM
From: Don Martini	Read Replies (1) \| Respond to of 176387

Pink, Think about Preferred for reasonable options. They're slick & quick, low commissions. Here's the formula for maintenance requirements [which you referred to as "margin"]: At the-money [option strike = market price]: 20% of market In-the-money [you're winning] DEDUCT $1/share off the 20% down to a floor of 10% of the market price. Out-of-the-money [your losing] ADD $1 for each dollar you're behind. EXAMPLES, assuming market price is $100: 110 put, 20% of 100 = 20 + 10 = 30.00 90 put, 20% of 100 = 20 - 10 = 10.00 The broker holds the premium until the option is closed or expires, but you get interest on that money. I enjoy the way you can drop down an option chart in a trice and trade right off the chart at Preferred. Your maintenance requirement is updated daily too, and you can read it on one of their screens.

To: His Pinkness who wrote (112021)	3/25/1999 8:28:00 AM
From: Jeffry K. Smith	Read Replies (1) \| Respond to of 176387

PINK - I checked out Fidelity a number of years ago for selling puts (Level 3 approval) and at that time they had many requirements beyond sufficient margin - e.g. yearly income, net worth, and liquid net worth. Has that changed, or are you high enough in those categories that it doesn't matter? One more thing that really puzzles me - the Schwab people tell me that there is no way to lock up the $ in my account which "secure" my ability to sell puts (iow to make sure I have enough funds to cover in case I'm called) - how is it that Fidelity does so? Thanks, Jeff Smith