***OT*** Lobster,
Sorry, but January 2000, is too far out for me to even think about :-o
My options work is a 'near-in', as in next-month, kind of analysis.
But, unless the LEAP rules forbid it, I would think that someone who
bought the LRJAG calls has the option to exercise any time before
expiry day. I am not familiar with the 'rules-of-leaps', though, so
some else may want to jump in.
But lets look at what the RN leaps look like today with RN at 34 9/16:
Strike Last sale Time Premium(tp)
JAN'00 25 $10.25 $0.68 <--deep in the money=~no tp
JAN'00 30 $ 7.50 $2.94
Jan'00 35 $ 5.38 $5.38 Max tp
Using the above as an example:
Anytime RN goes to $46, or so then the Jan'00 35's would be worth
approx $11 (remembering that the tp goes to almost $0 for deep in the
money calls/leaps)... at that point, if RN advances any further I
think the stock could be subject to being called out. Now this doesn't
take into account any effect that the 11% yield would have.. it could
serve to further lower the take out price assuming the new owner had
thoughts of holding the stock rather than flipping it.
Once again, I'm not sure if the LEAPs are exercisable at any time
before expiry, like calls/puts.
Ben A. |
