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    range. Often, there is an opportunity to make a large gain in a
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    NOTES ON RJ REYNOLDS (RJR)
    Protective Put

    1. Up until early March 2003, RJR was in a trading range with a
    high of $47.50 and a low around $38.00.

    2. In early March, RJR broke that low around $38.00 and traded
    down to around $28.00 before trading back up to the $38.00
    level. It failed to break that resistant level a couple times.
    Then, in mid-September 2003, RJR gaps up and breaks the
    resistance level.

    3. Normally, when a stock breaks a resistance level, it normally
    trades up to find a new range most specifically a top of the
    range. Often, there is an opportunity to make a large gain in a
    very short amount of time when a stoc
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    d a low around $38.00.

    2. In early March, RJR broke that low around $38.00 and traded
    down to around $28.00 before trading back up to the $38.00
    level. It failed to break that resistant level a couple times.
    Then, in mid-September 2003, RJR gaps up and breaks the
    resistance level.

    3. Normally, when a stock breaks a resistance level, it normally
    trades up to find a new range most specifically a top of the
    range. Often, there is an opportunity to make a large gain in a
    very short amount of time when a stoc
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    k up to the $38.00
    level. It failed to break that resistant level a couple times.
    Then, in mid-September 2003, RJR gaps up and breaks the
    resistance level.

    3. Normally, when a stock breaks a resistance level, it normally
    trades up to find a new range most specifically a top of the
    range. Often, there is an opportunity to make a large gain in a
    very short amount of time when a stoc
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    aks the
    resistance level.

    3. Normally, when a stock breaks a resistance level, it normally
    trades up to find a new range most specifically a top of the
    range. Often, there is an opportunity to make a large gain in a
    very short amount of time when a stoc
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    st specifically a top of the
    range. Often, there is an opportunity to make a large gain in a
    very short amount of time when a stock beaks a support or a
    resistance.

    4. After breaking out of the previous trading range, in
    mid-September 2003 at a price of about $40.00, RJR trades up to
    $60.00 by mid-December 2003. This represents a 50% gain in
    approximately 3 months.

    Conclusion: RJR offers investors two opportunities to use the
    protective put strategy and in two different ways.

    First, the protective put strategy can be used to provide
    protection when an investor tries to pick the bottom in a stock.
    The wrong bottom can cost th

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