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Strategies & Market Trends : Systems, Strategies and Resources for Trading Futures -- Ignore unavailable to you. Want to Upgrade?

To: robin 187 who wrote (21843)	4/27/1999 12:07:00 PM
From: Judy	Respond to of 44573

otot Robin, start from Nov'97 and work back. Don't believe I visited that thread after that time.

To: robin 187 who wrote (21843)	4/27/1999 2:32:00 PM
From: Patrick Slevin	Respond to of 44573

Think about it logically. The Simple answer, disregarding any complex derivative strategy. If you are buying Puts or Calls you are either hedging against a move against an existing position or you are speculating on a move. Some one has to take the Risk of the "other" side of the trade by selling you such a contract. That person either sells it to you covered in some fashion or speculates by selling it uncovered...except for Cash put up as margin. Such a Sale is often called "Shorting" the Option...be it put or call. Now this Speculator, in the case of "Shorting" puts, wagers that s/he knows enuf about the equity that the gamble is the issue will not drop below such and such a floor. Were it to drop, the Speculator usually has enuf faith in the issue that he or she is willing to take it at such a price. Either way, the "Seller" keeps your money. Think about Insurance. You buy insurance....someone writes it. You are betting you will have an accident and they are taking the other side of that bet