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Strategies & Market Trends : Options
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To: Jill who wrote (467)1/1/2000 6:37:00 PM
From: taxman  Read Replies (1) of 8096
 
"taxman has said he does so [exercises] on margin, for that purpose. Then having that many more common shares, one generates more margin capacity. Thus avoid 40% taxes on short term cap gains."

yes i do--and keep pyramiding. i buy puts and calls without any further cash into my account and with minimization of taxes.

"if [qualcomm] did half as well next year"

if you are confident that qualcomm will go up 15 fold in 2000, put all your money in out of the money calls.

"you can exercise on a Saturday"

as a practical matter i have to exercise on friday because my broker is not available on saturday. just the same if you have an out of the money call and favorable news comes out after the close on expiration friday which you believe will cause the stock to rise above the strike price the following monday, you would want to exercise an out of the money call.

regards
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