EMC How high can it go? Message Board

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Technology Stocks : EMC How high can it go?

EMC 29.05

0.0%

Sep 15 5:00 PM EST

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To: Elmer Flugum who wrote (13043)	8/21/2001 11:12:45 PM
From: Bread Upon The Water	Read Replies (1) of 17183

Buying puts---betting the strike price of $15 will be achieved by either the 3rd Fiday in September or October. Actually, just getting to 15 won't make you any money it would have to go past that by about a point for it to be profitable for you after you take into account the option price and the commission. After 14 you should be able to sell your put option on a 1 to 1 basis for every point it declines. Let's say it cost you $155 to buy the October contract ($125 plus $30 commision at 13 your option is worth about $250 so you have made about a 67% return in two months. If the stock doesn't go to 14 you've lost some money. If it doesn't go to 15 you lost the entire $155 you've invested. If you think now is the time to buy EMC--actually, own the stock--you can use the put as a hedge to protect yourself on the downside in case it sells off in the short term. Want to bet? Bill

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