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Strategies & Market Trends : Options

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To: Jill who wrote (74)12/26/1999 11:21:00 PM
From: 100cfm  Read Replies (2) of 8096
 
<<I'd be really interested in understanding the different leverage I get from May 40s, 50s, 60s or the OTM (almost ATM at this point) 75s>>

Jill the may 40s, 50s, 60s all went up about the same on thurs. between 7 and 8 pts. so i don't think there's any difference in leverage. however the 60s and 75s have more time premium in them which at some point is going to go away causing them to temporarily underperform the 40s and 50s which basically have no time premium left. on the other hand you can buy alot more 75s then 40s. i'm sure there's a formula to figure out which is the better buy. i couldn't figure it out and believe Gem* will be alot higher in may so i bought all of the above!

ps the 75s were only up 5 1/2.

100
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