Intel: Short Term Stock and Option Trading/Strategies Message Board

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Technology Stocks : Intel: Short Term Stock and Option Trading/Strategies

INTC 39.50

-1.2%

9:30 AM EST

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To: Nancy who wrote (127)	3/22/1997 1:34:00 PM
From: H.P. Yee	of 220

NANCY, <<the diff between owning stock and owning spread is, for the same amt of money, spread gives you much bigger % return if intc doesn't run above 140 much more oryou could close your 140c sometime between now and exp at very favorable costs - instead of selling leap, you could keep selling at or out of money calls every month - it works the same, except it doesn't initial limit your downside.>> There is another problem with buy leaps and selling short term calls, and that is if the stock take a sharp rise, the short term call (even if at slightly higher strike) may worth a lot more than you have sold it for. If you are lucky though, you be able to repeatly sell the short term calls, and own the long term call for free. But there is no free lunch, there is always risk. IMHO. -H.P.

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