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Technology Stocks : America On-Line (AOL)
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To: Dom B. who wrote (7422)3/22/1999 7:54:00 PM
From: Voltaire   of 41369
 
Dom B.,

The call you want to write is the Jan. 2000 5.6 - symbol LMRAA. I was unable to write this morning because I would have made the market. I had to settle for writing the 01 10.0, 01 11.2, 01 33.7 and 01 40 etc. to get my 150 contracts filled without giving up too much. I still was able to end up with 25,000 AOL for the great run today.

As for exiting the stock there is no problem because the gain of the stock offsets the gain of the calls because they move for all practical purposes in lock step. This is due to the fact that with the premium and the strike price combined you have parity with the selling price of AOL. That is why this is a great strategy because you are simply using the money they are willing to lend on the already extended collateral.

Stay in touch,

Voltaire
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