The following is the OptionBT sighting of    "JP-8".
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Title   :   "JP-8"
Position Description   :
     Position taken   :     July 22,2003 (Part A)
     12 Months out,
     Bull Call Spread for "debit",
     Uncovered Short for "credit",
     Long leg of Bull Spread is above the the money by 62 points at the close of the day,
     Naked Short Puts are out of the money by 188 points at the close of the day,
     Bought 04 Jun 1050 Calls (212 cnt),
     Sold     04 Jun 1075 Calls (212 cnt),
     Sold     04 Jun 800 Puts (200 cnt),
Expiration/Settlement    :    June 18, 2004 / Settlement = 1129.60
Count   :                           212 (Pairs) of Bull Call Spread and 200 naked Short Puts
Credit or (Debit)   :            $233,800
Margin   :                          None for the Bull Call Spread (strike of long calls < strike of short calls),
                                        $5,320,330 for the 200 count of naked short, using my broker's calculations
                                        ($10K + Premium + 15% of the Index Value * 100)

Results   :                          Break Even @ SPX >= 789
                                        Max Return if SPX >= 1075 then the total net profit will be +$763,800


Position Description   :
     Position taken   :     July 25,2003 (Part B)
     12 Months out,
     Bull Call Spread for "debit",
     Bull Put Spread for "credit",
     Long leg of Bull Spread is above the the money by 77 points at the close of the day,
     Higher Strike on the Put Spread is 48 points out of the money at the close of the day,
     Bought 04 Jun 1050 Calls (450 cnt),
     Sold     04 Jun 1100 Calls (450 cnt),
     Bought 04 Jun 700 Puts (300 cnt),
     Sold     04 Jun 950 Puts (310 cnt),
Expiration/Settlement    :    June 18, 2004 / Settlement = 1129.60
Count   :                           450 (Pairs) of Bull Call Spread
                                        Unequal Leg Put Spread (300 cnt and 310 cnt)
Credit or (Debit)   :            $1,164,500
Margin   :                          none for Bull Call Spread (strike of long calls < strike of short calls)
                                        $7,500,000 for the 300 pairs of the Bull Put Spread ($25K per pair)
                                        $401,820 for the 10 uncovered naked puts
                                        ($10K + Premium + 30% of the Index Value * 100) - out of the money amount

Results   :                          Break even @ SPX > 912
                                        Max return @ SPX >= 1100 then the total net profit will be +$2,289,500

Summary:
Since the SPX close for June 2004 was 1129.60 both Parts A and B
met their entire goals and the total for A and B was $763,800 + $2,389,500 = $3,053,300

Comments   :   "JP-8"
PART_A:
  "JP-8" (Jet Propellant - 8) is the jet fuel for military and civil jet aircraft. This position is jet powered for sure. "JP-8" either rides the tide and takes home the $233K+ if nothing happens or pockets $763K+ if something happens positive on the high side with almost a year to go. There is very little reason to considering "hitting the silk" since the low-end-break-even of SPX = 789 is highly unlikely.

Wait there's more!

PART_B:
In the second picture above, "JP-8" is on the move again. This time even more confident he is willing to use a lot more margin to establish his bullish position. What a difference a lot of margin makes. This position has a low break even (SPX > 912) and a large high end return.

If "JP-8" has the right stuff then the SPX will close above 1100 by the third Friday of June 2004. In this case this jet powered pair of positions will net (Part A + Part B) $3,053,300. This sounds about right don't you think.

SIDE NOTE:
Even though these positions use up a lot of margin ($5.3M for Part A and $7.9M for Part B) these are great examples of what works well. Let's don't forget the in-the-pocket credit of $1,398,300 to have and to hold for a year if not to lighten your margin bill. The low-end-break-even-points push the risk factor very low.

Update:
The SPX closed at 1113.88 on April 29,2004. Only two months left. Let's hope the market doesn't hit some pockets of rough air and throw JP-8 off course. JP-8 needs 1100 on the SPX for a completed mission.

Final words:
The markets were skidish all through the spring of 2004. Holding above 1100 was a close call but "JP-8" made the right call.
He made it look easy.

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