3Com Corporation (COMS) Message Board

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Technology Stocks : 3Com Corporation (COMS)

COMS 0.00130

-18.8%

Nov 7 11:47 AM EST

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To: Mang Cheng who wrote (39406)	2/16/2000 4:40:00 PM
From: rabbit	Read Replies (2) of 45548

Mang, First of all, I am surprised that you can buy options on margin. Secondly, initial margin is normally 50%, house call margin is specific to each brokerage, usually around 70%. Meaning COMS has to be at $53.5 when you get the house call. Possible? yes, but unlikely. Thirdly, when COMS price drops, your leap price drops too. You can get margin call if you buy them on margin. Last but not the least, buying is for leverage, controlling large numbers of shares with small sum of capital. That being the goal, you should buy March or April options. I don't expect you to follow my advice. It is your money.

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