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Technology Stocks : CMGI What is the latest news on this stock?
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To: mike machi who wrote (10297)6/16/1999 8:47:00 PM
From: Mark Peterson CPA  Read Replies (1) of 19700
 
Mike, if you have the inclination, order Larry MacMillan's "Options as a Strategic Investment". A bit like your college day physics classes and more than a little calculus involved, but nearly EVERY market maker in options and certainly all the specialists have it nearly committed to memory. So that's the quantitative side of those who may take the other side of your trade.

For lighter fare, go to the cboe web site (www.cboe.com) and drill down through their options pages.

The simplest strategy is probably doing a buy/write: buying the stock and selling an out of the money call. But the price and volatility at which you do the trade will greatly affect your possible profit on the trade. And MacMillan spells it out...

And before you can do any of this at your brokerage firm, you need to request an options application and subsequent approval of the application.

Dabbling in options, without understanding the internals of what you are doing is a surefire way to incinerate a great deal of wealth. But on the other side, if you read the book and understand the dynamics, it's a great way to hedge the risk of most positions for all but cataclysmic events...

And for many on this and other threads, the unannounced visit of a mother-in-law would probably qualify as such.

Hope this helps a bit,

Mark
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