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Technology Stocks : How high will Microsoft fly?
MSFT 492.01+1.3%12:59 PM EST
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To: Sir Francis Drake who wrote (21988)5/3/1999 10:42:00 PM
From: Exacctnt  Read Replies (1) of 74651
 
Sir Francis, I understand exactly what you are saying. As a long-long time Microsoft shareholder, I am also somewhat skittish on the near and intermediate-term outlook on MSFT's stock price. The stock price has not been acting well for the past couple of weeks. There is constant selling pressure.

In fact, I had bought put options over a week ago as a result of seeing weakness in the price of the stock. The puts were bought with the idea that MSFT would experience a sharp drop (8-10 points) with a quick rebound. I was hoping to be nimble enough to cash out with a nice gain. Instead of a sharp drop, we are experiencing a gradual erosion in the price of the stock. My strategy of making a quick buck is now transforming into a hedging position. For the past 6 trading days I had the opportunity to sell the puts for a nice gain at some point in each day. However, because of the weakening price of the stock, I haven't sold any of the puts and now I am viewing them a serious protection from continuing declines in the stock price.

In the past, I have played the options game, both puts and calls, with various degrees of success. All those option plays have not involved the usage of my underlying holdings of MSFT stock. For the first time, I am now seriously considering playing options with the idea of "capital preservation". This market is too crazy. <g>

Regards,
Bob
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