Ascend Communications (ASND) Message Board

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Technology Stocks : Ascend Communications (ASND)

ASND 209.66

+0.5%

10:51 AM EST

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To: Jack Stirling who wrote (20878)	11/4/1997 8:53:00 AM
From: john p. carney	of 61433

Well Jack, if you really think ASND has much more down side and want to protect your long shares, you would purchase puts (for example Dec 25s symbol QQAXX) to protect your entire position you would buy 4 contracts (each contract gives you the right to sell 100 shares to the put writer (seller) at the strike price. As the price of the stock sinks, the value of the puts increases. Lets say for grins that ASND goes to 10 on Dec option expiration day. The puts would be worth $1250 dollars per contract x 4 contracts - $400.00 (what you paid for them) - commisions. Of course if you make money with the puts you can always sell them before expiration day and will pocket some time premium also. Personally, I think the ASND news was misunderstood yesterday ( I know I thought it implied 10% YEARLY growth at first) and I don't know if I can see ASND sinking much further. Hope this helps. John

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