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Hi Neal,
Not to put words in Ben's mouth, but what he is
doing is purchasing LEAPS (long tern options) on the QQQ, LRIAI (he typed IRIAI
by mistake I believe) is a Jan 2004 35 call. He owns 175 of
then, currently @ 6.7. He then sells calls against these leaps for
income. The QQQEJ is a May 2002 36 call. He originally
sold 175 of these and recently bought them back for a profit of $21075. At
the same time he purchases Puts at a lower strike and a nearer month than the
calls he sells. He originally purchased 175 QAVPH April 2002 34
Puts and just sold then for a loss of $1250. His net profit was 21075
- 12500 = $8575. He still owns the 175 LRIAI LEAPS
If I read him correctly, he has established a
new position by selling 175 QQQFJ (June 2002 36 call) for a credit
of $28875 and purchased protection in the form of 175 QAVQH May 2002
34 Puts (I believe he mistyped it as QAVGH, a July 34 Call which is not
trading now) for a debit of $21875.
Subsuming the QQQ's for the IRIAI LEAPS (my
preference for this trade) you get a favorable 3 to 1 risk to reward ratio
as shown in the attachment
Good luck and good trading,
Ray Raffurty
<BLOCKQUOTE
style="PADDING-RIGHT: 0px; PADDING-LEFT: 5px; MARGIN-LEFT: 5px; BORDER-LEFT: #000000 2px solid; MARGIN-RIGHT: 0px">
----- Original Message -----
<DIV
style="BACKGROUND: #e4e4e4; FONT: 10pt arial; font-color: black">From:
Neal
Chabot
To: <A title=realtraders@xxxxxxxxxxxxxxx
href="mailto:realtraders@xxxxxxxxxxxxxxx";>realtraders@xxxxxxxxxxxxxxx
Sent: Thursday, April 04, 2002 11:29
PM
Subject: Re: [RT] Re: option update
Ben,
if you just say what the month and strike price are
instead of the codes, it would be easier for most of us
to decipher what you are doing.
Neal
<BLOCKQUOTE
style="PADDING-RIGHT: 0px; PADDING-LEFT: 5px; MARGIN-LEFT: 5px; BORDER-LEFT: #000000 2px solid; MARGIN-RIGHT: 0px">
----- Original Message -----
<DIV
style="BACKGROUND: #e4e4e4; FONT: 10pt arial; font-color: black">From:
<A title=profitok@xxxxxxxxxxxxx
href="mailto:profitok@xxxxxxxxxxxxx";>profitok
To: <A
title=realtraders@xxxxxxxxxxxxxxx
href="mailto:realtraders@xxxxxxxxxxxxxxx";>realtraders@xxxxxxxxxxxxxxx
Cc: <A title=gannsghost@xxxxxxxxxxxxxxx
href="mailto:gannsghost@xxxxxxxxxxxxxxx";>gannsghost@xxxxxxxxxxxxxxx
Sent: Thursday, April 04, 2002 7:28
PM
Subject: Re: [RT] Re: option
update
Now that I have time let me finish
the closing of the long 175 qavph resulted in a LOSS
of $12500
selling 175 qqqfj result in income
of $30625
and
buying protection again 175 qavqh
cost $21000
current value
175 IRIAI is $120750
175 short qqqfj is worth
$28875
and long qavgh is worth $21875
on the closed positions we are ahead
$8575 in 4 week for a $133000 investment
<BLOCKQUOTE
style="PADDING-RIGHT: 0px; PADDING-LEFT: 5px; MARGIN-LEFT: 5px; BORDER-LEFT: #000000 2px solid; MARGIN-RIGHT: 0px">
----- Original Message -----
<DIV
style="BACKGROUND: #e4e4e4; FONT: 10pt arial; font-color: black">From:
<A title=profitok@xxxxxxxxxxxxx
href="mailto:profitok@xxxxxxxxxxxxx";>profitok
To: <A
title=realtraders@xxxxxxxxxxxxxxx
href="mailto:realtraders@xxxxxxxxxxxxxxx";>realtraders@xxxxxxxxxxxxxxx
Cc: <A
title=gannsghost@xxxxxxxxxxxxxxx
href="mailto:gannsghost@xxxxxxxxxxxxxxx";>gannsghost@xxxxxxxxxxxxxxx
Sent: Wednesday, April 03, 2002 10:11
AM
Subject: [RT] Re: option update
just to let you know
we got filled on the buy to close 175 qqqej
at 1.75
net profit $21075
next
we are selling qavph
order to sell at.75
<BLOCKQUOTE dir=ltr
style="PADDING-RIGHT: 0px; PADDING-LEFT: 5px; MARGIN-LEFT: 5px; BORDER-LEFT: #000000 2px solid; MARGIN-RIGHT: 0px">
----- Original Message -----
<DIV
style="BACKGROUND: #e4e4e4; FONT: 10pt arial; font-color: black">From:
<A title=profitok@xxxxxxxxxxxxx
href="mailto:profitok@xxxxxxxxxxxxx";>profitok
To: <A
title=realtraders@xxxxxxxxxxxxxxx
href="mailto:realtraders@xxxxxxxxxxxxxxx";>realtraders@xxxxxxxxxxxxxxx
Cc: <A
title=gannsghost@xxxxxxxxxxxxxxx
href="mailto:gannsghost@xxxxxxxxxxxxxxx";>gannsghost@xxxxxxxxxxxxxxx
Sent: Monday, March 25, 2002 10:03
PM
Subject: option update
current value
remember purchasing 130000 of options in the last
4 weekshere is the update as of today closehere is the
update as of today closelong 175
IRIAI total cost $144000 current value
$$133000long 175 QAVPH
cost $25625 current value $ 11375short
175 QQQEJ sold $44875 current
profit $16000have order to buy back to close@
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Attachment:
Description: "QQQ1.jpg"
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