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Dear Ben,
I do not follow OEX as closely as S&P so permit me a few questions:
1.How far out per cent wise are your numberes from the close on wiching Fri.
2.What premiums and cost do you have on the four positions and do you
pre-determine what is acceptable.
3.How long does it take to get filled.
4.You can do the same thing with conventional S&P option Strangles and put
your protection above the sell price as you do but it takes at least 2 to 3
days to get filled at decent prices.
Appreciate your comments,
John
>From: Proffittak@xxxxxxx
>Reply-To: Proffittak@xxxxxxx
>To: <realtraders@xxxxxxxxxxxxxxx>
>CC: realtraders@xxxxxxxxxxxxxxx
>Subject: [realtraders] Cappello Strangles {02}
>Date: Mon, 29 Nov 1999 06:21:27 EST
>
>In a message dated 11/26/99 7:04:19 PM Eastern Standard Time,
>jvc689@xxxxxxxxxxx writes:
>
><< I am going to try to stir interest in this one more time. I have been
> studying this and hate failure. In my pursuit I have not come across this
> method which conceivably could work 9 of 10 times. In examination you
>will
>see
> price is set 7% from upper and lower limits penetration that may only
>happen
> 1 or 2 times per year. Assuming the worst [$1500 premium X 10 wins =
>$15,000
> -- protection cost -- premium or $3500 -$1500 [2 X $2000] = $11,000
>profit
>per
> Strangle per year. My estimate is $7500 per Strangle could make this
> lucrative.
> > > >>
>hi
>this sounds good in normal times
>now we are in hi risk time
>if you did this in third Fri of Sep 87
>and try to cover in Fri 10/15/87 your loss would have been drastic
>an easy way to do this is what i do all year
>i sell DEC 825 oex calls and buy DEC 830 calls
>i sell DEC 700puts and buy DEC 695 puts
>on a 250000 mutual funds portfolio i do 30 per month
>and never have to worry
>(Max loss is 15 times 500 minus premium collected)
>this works 9 month out of 12
>
>
>
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