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Technology Stocks : Broadcom (BRCM)
BRCM 54.670.0%Feb 9 4:00 PM EST
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To: Keith A Walker who wrote (1948)6/19/1999 11:04:00 PM
From: Bill Holtzman  Read Replies (1) of 6531
 
Setting up your options position is fairly straightforward. You're willing to buy the stock at 110 so you sell a put, and you want to sell some of the hype so you sell a call but buy a higher priced call "just in case". The hardest part of this comes after you've set up the position. Deciding what to do as the stock gyrates can be difficult. However, if the stock were to plunge immediately you could liquidate your call position with a profit and then wait for the stock to come back to make money on your put.

My experience has been, though, that between the bid/asked spreads and the commissions this is a tough cat to skin.

Bill
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