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Non-Tech : Bill Wexler's Dog Pound -- Ignore unavailable to you. Want to Upgrade?

To: Bill Wexler who wrote (851)4/28/1999 10:38:00 AM
From: Daniel Chisholm  Read Replies (1) | Respond to of 10293
 
Instead of selling covered puts, why not sell their (synthetic) equivalent, a naked call?

Selling a naked call might be better because it requires only one set of commissions (instead of two). Also, you don't need to borrow stock and hence can't have your short bought in.

Further, a naked call has the cachet of being the most risky sort of play out there, one in which you accept unlimited loss in exchange for a limited profit (the premium). If you are not comfortable selling a naked call on a stock, you should be equally uncomfortable selling a covered put, because your risk and reward are much the same.

- Daniel



To: Bill Wexler who wrote (851)4/28/1999 12:22:00 PM
From: Alastair McIntosh  Read Replies (2) | Respond to of 10293
 
Bill, you might want to take a look at IRID. A Motorola spin off that is racking up huge losses in the satellite phone business. Customers are staying away in droves. Technology is passing them by and I doubt that they will ever turn a profit. There is not a large market for $3000 phones.

Looks like a low risk short play. Currently trading at $15.00 with estimated losses this year of over $10/share.

Al


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