Chief Editor
I have stayed long Australian stocks and whilst I sold my US bull call spreads I am having a bob each way as I still hold US bear put spreads. These are long dated going out to March 2005 and bought very cheaply so at the end of the day I am ambivalent which way the market does move as either way I am going to win.
Hail Hedging! This market has proven that the market can so often defy popular opinion and the technicals. Reality is such that you cannot always be right so that is why it is important to widen your chances of winning by using options. They may not be your main game - that's fine but do not ignore them entirely. That is why we run a regular feature article on options by Mike Lawch. I hope you find them of value. Even though Mike focuses on US options the same principles apply to the Australian market. There are some differences and these I covered in previous articles.

The key object behind Trading Tutors Newsletter is client education and sometimes that means taking readers outside their comfort zone. The spin-off from investor education is that clients improve their skill in not only preserving capital but also in growing their capital with an acceptable trade off between risk and reward. These are sound reasons why readers should consider going beyond "buying and holding" physical stock and consider some form of hedging.

If you have enjoyed the big run up in Australian Optionable stocks you may want to consider locking in some of those profits by using options. You might like to consider puts that will ensure you profit if the market falls but if the market rises you will also profit by holding your physical stocks.

I commend to you to open your eyes to the many alternatives in growing your capital!

Tom Scollon