[RT] John Cappello uncovered Puts

[John Cappello <jvc689@xxxxxxx>]

Dear Slawek,

I do not know the answer for sure re. margin. What I have is a good 
deal from Saloman Smith Barney which permits me all of the trades I 
want for a flat fee at $282 per quarter. I have talked to their top 
option people and they can not give me a clear picture of the amount 
of margin needed per uncovered margin premium collected. At the end 
of each day I make a trade they credit my account with the premium.

I currently have on board 12 uncovered options and 2 covered options. 
Technically my available margin should be $100,000 at this point 
assuming no options were on board in the particular account I am 
using.

They have never told me I had a margin problem and the underlying 
stocks range from $15 to in the $50's and I am doing 10 options of 
each.

Obviously I have an exit stategy if I do not see them expiring 
worthless, however if one were to calculate the total price of all 
the stocks if executed it would come to over $200,000. So I do not 
believe they calculate margin on that basis...and if their top people 
are not clear on the subject...I will continue until they give me 
feedback.

Sincerely,

John



------------------ Reply Separator --------------------
Originally From: "BobR" <bobrabcd@xxxxxxxxxxxxx>
Subject: Re: [RT] John Cappello uncovered Puts
Date: 01/05/2003 10:47am


Do you mean Mark Clemons of Premium Research Group?
  ----- Original Message ----- 
  From: SLAWEKP@xxxxxxx 
  To: REALTRADERS@xxxxxxxxxxxxxxx 
  Sent: Sunday, January 05, 2003 9:55 AM
  Subject: [RT] John Cappello uncovered Puts


  John,

  Could You give  monthly % return on margin required to support 
those 
  uncovered puts.
  Back in 1994 I was selling credit spread 3 months out on both puts 
& calls on 
  OEX trying to get 2.5 points or better on 5 point spreads between 
strikes so 
  my risk was 5 - 2.5(credit) =2.5(risk) or less.

  I learn that from one pro Marc Clemonts out of Chicago back in 
1994. Market 
  was range bound but he was getting constant $10.000 to $15.000 a 
month on 
  $100.000 margin just using 3 month options  credit spreads

  Slawek

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