America On-Line: will it survive ...? Message Board

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Technology Stocks : America On-Line: will it survive ...?

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To: Stingray who wrote (3136)	5/16/1997 10:00:00 AM
From: yard_man	of 13594

Appreciate your comments. The drawback you mentioned about tying up funds is the major negative of the scenario I've mentioned: Stock has been hammered and your assessment is that it can't fall much farther. If you're wrong, obviously it's a loser (stock continues to fall leaving you with a substantial loss). It's true that if exercised you will be buying @ higher than market prices at some point in time, but if it's near the bottom and low is really an "exahaustion" low and you're exercised, you've lowered your cost basis without having to pinpoint exactly the bottom. -- Your other option is to purchase the stock at it's very bottom -- hard to do. If you put in a limit order you have to have cash or margin to make the purchase if it goes through, right? Points you made about considering the risk and rewards of other strategies is well-taken, though. Before doing this I'll spend a little time analyzing the possible outcomes and the outcomes for alternative approaches. Thanks.

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