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<DIV><FONT size=2>You probably won't dissuade him from undertaking his reckless
endeavor, however perhaps you can prevail upon he and his wife that he should
obtain an education in options before doing so. I haven't traded options in
years and there may be something better out now, but I found Larry Macmillan's
Options as a Strategic Investment to provide a good grounding in the important
basics such as volatility and delta. Everyone thinks options are about
buying/selling direction when, in fact, options are about buying/selling
premium. Not that direction is unimportant but premium is the key.</FONT></DIV>
<DIV> </DIV>
<DIV><FONT size=2>Bottom line is that options believed to be about to split will
carry low put premiums and high call premiums so he's not going to get paid much
premium for selling naked puts.</FONT></DIV>
<DIV> </DIV>
<DIV><FONT size=2>Earl</FONT></DIV>
<BLOCKQUOTE
style="BORDER-LEFT: #000000 2px solid; MARGIN-LEFT: 5px; MARGIN-RIGHT: 0px; PADDING-LEFT: 5px; PADDING-RIGHT: 0px">
<DIV style="FONT: 10pt arial">----- Original Message ----- </DIV>
<DIV
style="BACKGROUND: #e4e4e4; FONT: 10pt arial; font-color: black"><B>From:</B>
Dennis L. Conn </DIV>
<DIV style="FONT: 10pt arial"><B>To:</B> <A
href="mailto:realtraders@xxxxxxxxxxxxxx";
title=realtraders@xxxxxxxxxxxxxx>RealTraders Discussion Group</A> </DIV>
<DIV style="FONT: 10pt arial"><B>Sent:</B> Thursday, May 20, 1999 6:59
PM</DIV>
<DIV style="FONT: 10pt arial"><B>Subject:</B> STKS: selling puts</DIV>
<DIV><BR></DIV>
<DIV>Hello all,</DIV>
<DIV> </DIV>
<DIV>I'd appreciate some input from those experienced in the strategy of
selling naked puts on stocks that are about to split. A friend of mine is
convinced that he can pursue this strategy with almost no risk to his account
- hey, it worked on paper, right? After all, stock splits make the price go
up, right? Apparently, this is the assumption on which the premise is based -
I can't seem to explain why a twelve-year bull market (let's not quibble)
might skew his back-testing.</DIV>
<DIV> </DIV>
<DIV>He has no experience in trading (naturally), and I've never done stocks -
so I can't seem to convince him that his idea of "rolling out" to the
next month's options and selling more, may entail not only some risk, but
possible account devastation, given a prolonged downtrend.</DIV>
<DIV> </DIV>
<DIV>Now he's convinced himself to give up twenty-five years of building an
insurance business in order to daytrade his way to wealth by year's end! At
least he's using one of the better systems for online trading that I've
seen recommended here lately, but come on! Today he found himself forced to
roll out to June options, and tells me he never loses! I remember when I
thought the same way at first, and how quickly retribution followed...</DIV>
<DIV> </DIV>
<DIV>Can someone please give me something I haven't thought to say that
might make him wake up? Or is this automatically going to fulfill his widest
get-rich-quick fantasies as he believes? I mean, hey, if it's that easy, I'll
give up commodities and sell a passel o' puts tomorrow!</DIV>
<DIV> </DIV>
<DIV>What happens if the holders of those puts exercise them? I'm pretty
sure it's going to do the same thing to him as selling silver calls in the
Buffet rush did to me when I first tried writing options (duh). Anyone out
there with some practical advice they'd care to offer?</DIV>
<DIV> </DIV>
<DIV>Dennis C.</DIV>
<DIV><A
href="mailto:dlc@xxxxxxxxx";>dlc@xxxxxxxxx</A></DIV></BLOCKQUOTE></BODY></HTML>
</x-html>From ???@??? Tue May 25 18:01:42 1999
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Date: Fri, 21 May 1999 05:39:00 -0700
Reply-To: petena9090@xxxxxxxxxxxxxx
Sender: owner-realtraders@xxxxxxxxxxxxxx
From: "Peter Namtvedt" <petena9090@xxxxxxxxxxxxxx>
To: RealTraders Discussion Group <realtraders@xxxxxxxxxxxxxx>
Subject: Re: LINDA
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Last note from Linda was on May 9th:
While we're on the subject of books...
I finally cracked open my copy of the classic by Edwin LeFevre,
Reminiscences of a Stock Operator.
If you have never read it, you are missing out on a good read, a valuable
course in trading and a colorful history lesson. I highly recommend it!
Linda
Swope's Mountain Photography
http://www.swopephoto.com
linda@xxxxxxxxxxxxxx
Climb the mountains & get their glad tidings: Peace will flow into you as
sunshine into flower; the winds will blow their freshness into you & storms
their energy, & cares will drop off you like autumn leaves. John Muir 1838 -
1914
While we're on the subject of books...
I finally cracked open my copy of the classic by Edwin LeFevre,
Reminiscences of a Stock Operator.
If you have never read it, you are missing out on a good read, a valuable
course in trading and a colorful history lesson. I highly recommend it!
Linda
Swope's Mountain Photography
http://www.swopephoto.com
linda@xxxxxxxxxxxxxx
Climb the mountains & get their glad tidings: Peace will flow into you as
sunshine into flower; the winds will blow their freshness into you & storms
their energy, & cares will drop off you like autumn leaves. John Muir 1838 -
1914
-----Original Message-----
From: Edelina <duis.abn@xxxxxxxxx>
To: RealTraders Discussion Group <realtraders@xxxxxxxxxxxxxx>
Date: Thursday, May 20, 1999 8:01 AM
Subject: Re: LINDA
>Linda is one lady posting messages.
>she has a photography studio
>she and me were the only women on this forum
>the men in this forum were provocators...
>so this forum need some courageuse women too.
>
>I am sure someone still have her messages with
>the Photography studio.....and the tides in the valleys and
>the peace bei the mountains......
>
>thanks...
>
>
>-----Original Message-----
>From: Johnny Storm <iceman_nrg@xxxxxxxxx>
>To: RealTraders Discussion Group <realtraders@xxxxxxxxxxxxxx>
>Date: Donnerstag, 20. Mai 1999 14:29
>Subject: Re: LINDA
>
>
>>Who is Linda?
>>
>>--- Edelina <duis.abn@xxxxxxxxx> wrote:
>>> where is linda please .
>>>
>>> I lost my bag with linda adress
>>>
>>> where is linda ???
>>>
>>> please her eMAIL .....
>>>
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>><DIV><FONT color=#000000 size=2>where is linda please .</FONT></DIV>
>><DIV> </DIV>
>><DIV><FONT color=#000000 size=2>I lost my bag with linda adress
>></FONT></DIV>
>><DIV><FONT color=#000000 size=2></FONT> </DIV>
>><DIV><FONT color=#000000 size=2>where is linda ???</FONT></DIV>
>><DIV><FONT color=#000000 size=2></FONT> </DIV>
>><DIV><FONT color=#000000 size=2>please her eMAIL
>>.....</FONT></DIV></BODY></HTML>
>>
>>
>>_____________________________________________________________
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>>
>
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