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Larry McMillan writes about using the VX volatility futures as insurance in
his second edition of "McMillan on Options". Try the w.cboe.com for
information on VX futures.
BobRA
----- Original Message -----
From: "Barry Kaufman" <102577.325@xxxxxxxxxxxxxx>
To: <omega-list@xxxxxxxxxx>
Sent: Monday, October 04, 2004 9:58 AM
Subject: Insurance against market crash
>
> I am asking for advice on how to insure against a market crash.
>
> I trade intermediate term to long term end-of-day (10 to 40 trades per
> year). And trade only market indexes, namely index funds and ETF's for
> SP500 and Russel 2000. I can also proxy a short of SPY or RUT by buying
> RYDEX or PRO Funds that go against the market. Most of my money is in
> Keoghs and IRA's and subject to no shorting regulations.
>
> My trading systems work fine for me but what scares me is a potential
> big, violent crash due to unexpected catastrophic news, namely
> terrorism. I am thinking about the market close after 9/11, the abrupt
> down draft in 1987, and didn't the market close for three months when
> world war 1 started?
>
> So, what kind of insurance is there? Leap put options on indexes might
> be the answer but I don't know anything about them. I am asking to be
> lead in the right direction to do research.
>
> By the way, if the exchanges did close for an extended period, then
> would option expiration date be extended?
>
> Thanks, Barry.
>
>
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