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Biotech / Medical : Biotech Derivatives

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To: RWReeves who wrote (473)	6/27/2000 2:36:00 AM
From: dalroi	Read Replies (2) of 555

Calp option premies are indeed hughe instead of selling jan 2001 50/55/60 i sold july 45 (bought stock at 44) think first month premies are too hughe to skip eg july 45 @ 9 3/4 august 45 @ 12 3/8 differnce only about 3$ for one month extra if you believe in calp a nice strategy could be buy stock 48 sell cc 45 9 3/4 sell naked put 45 or 40 5 3/4 or 3 5/8 if above 45 one sells for 45 +16 or 12 (rounded) or retrun is 48-16 = 33 sold for 45 gain 12$ on 33 for 1 month 33% return else if below 45 you buy your new calp stock for 29$ break even becomes then 38 or 20% below price today cheers stefaan

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