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Strategies & Market Trends : How To Write Covered Calls - An Ongoing Real Case Study! -- Ignore unavailable to you. Want to Upgrade?

To: Jon Tara who wrote (10684)5/10/1999 2:42:00 PM
From: Dan Duchardt  Read Replies (2) | Respond to of 14162
 
Jon,

Thanks for the reply. Who's rule is it that you need a margin account to sell a cash backed naked put? Is this an SEC mandate, or is it just what all the brokers do? It seems really odd that with all the proof in the world that selling naked puts with 100% cash to back them up is no more risky (even less) than writing covered calls, that the "system" allows you to do one but not the other. I would argue it's a lot safer than buying stock because you obligate less money to begin with, so if the stock fell apart you would be better off short the put than owning the stock. I guess some things are just a mystery.

Dan



To: Jon Tara who wrote (10684)5/10/1999 10:49:00 PM
From: Tom K.  Respond to of 14162
 
Jon, I do cash backed PUTs in my IRA account at Brown.

Tom


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