[RT] Re: Overnight disaster insurance?

[Proffittak@xxxxxxx]

In a message dated 1/28/00 12:49:26 PM Eastern Standard Time, 
nmas@xxxxxxxxxxxxx writes:

<< Ben
 Can you please explain your strategy according to the previous SP example?
 
 Thanks >>
At roll over time (DEC contract to the march contract)
I bought 4 SP 4 ND 4 nyfe and 4 DJ
at that time, The DEC      SP was at 1300 (aprox) I sold 24 1400 march calls
and bought 16 Jan 1275 puts,
when SP reached 1350 I sold the Jan 1275 puts and bought the FEB1325
puts.
Also   bought   at a loss  the  march  1400 calls.   and replace them with
march   1450  calls(24)
As the price keep going up  (50 handles)   I keep adjusting my position,,
the net result is that   you have always insurance  ,,  low DD   and
you have staying power for  YEARS,,
I was long all year  1996  1997  1998  1999 and  2000,,
when  do i get out??
when  SP future close under the 50, 55 exp. m/a I get out
and stay long the puts and short calls,
when the SP is back above both I re enter the long futures
The net net in my pocket  is  75-80%   of profit made on the future only 
position!
This  is the only way  to  trade peacefully,,  no stress  ,,  no worry of 
overnight exposure,,  and   yes a sacrifice  of   20-25% of profits
p, s
if  credit collected from selling calls is not  enough to pay for  puts  I 
just sell more calls  at  110  points above instead of  100 above,,
hope this helps
Ben