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Strategies & Market Trends : The Options Box

QQQ 626.65

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Jan 9 4:00 PM EST

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To: Poet who wrote (8701)	12/22/2000 9:32:23 PM
From: pompsander	Read Replies (1) of 10876

I need what I assume is some simple tax advice (although it won't apply until 2001) Eighteen months ago I initiated my first bull spreads. I bought calls on CSCO and RMBS and sold calls of a slightly different strike but the same expiration (Jan/2001). Well, amazingly considering the past year, all has gone pretty well and the CSCO and RMBS calls I bought are well in the money; the calls I sold hopelessly out of the money, with the purchased calls netting somewhat more. When I close out all positions around expiration date in Jan/2001 I will pocket the difference. A successful bull spread, albeit for not a lot of bucks. As I said, my first experiment. Frankly, it was an interesting experiment especially in light of watching the positions as the NAZ suffocated over the past few weeks. (please, please, don't let CSCO get to 25 before mid-January!!) Anyway, my question is about taxes. Can I treat the call I purchased as long-term capital gains? I have held them for well over a year and I presume the fact I had separate different strike calls I sold for purposes of the spread has nothing to do with it? Am I right. Many thanks

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