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Strategies & Market Trends : Value Investing

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To: aniela who wrote (16902)4/20/2003 6:46:08 PM
From: Allen Furlan  Read Replies (1) of 78550
 
Wiesia, re margin on options. Since this is value thread I will be brief. Margin at Brown is 10% of stock price(for stocks more than 10% out of the money,otherwise 20%) plus proceeds of sale. A 4 dollar stock is 40 cents plus proceeds which are already in your account.
In context of value investment I doubled down on dal Jan05/35 calls at .80. From value perspective look at dal 10k,results of recent earnings report and WSJ article which shows dal as highest salaries for attendants and pilots of five major airlines. Sprinkle into this cocktail common sense about dal competition which includes 2 major competitors relieved of debt thru bankruptcy. My assessment is that dal will not triple in price in 21 months. If I am correct I will earn 80 dollars on 115 dollars of margin. This to me is an excellent value prospect.
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