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Strategies & Market Trends : Gorilla and King Portfolio Candidates
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To: Mike Buckley who wrote (43982)6/29/2001 2:37:24 PM
From: Mike Buckley  Read Replies (2) of 54805
 
I sold my Qualcomm LEAPS expiring in 2001 two months ago because they were getting too close to expiration. Today I used half of the proceeds to replace them with LEAPS expiring in 2004. (I plan to use the other half of the proceeds to purchase Siebel LEAPS.)

It's interesting to me that when I sold the LEAPS about to expire in roughly 8 months, the stock was at about $56 and the options were about $19 in the money. I sold them for about $29. Yet with the stock at almost the same price, for my new LEAPS expiring about 30 months from now that are about $3 out of the money, it cost me only $24 to buy them. With the options being about 5% out of the money, I get two more years of time for a little less money.

Maybe Uncle Frank or one of the options mavens can explain that to me. Is it that options premiums have decreased that much in the last two months?

--Mike clueless but no cell phone will help Buckley
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