SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Technology Stocks : Ascend Communications (ASND)
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: Harry Ehrlich who wrote (24417)11/22/1997 3:12:00 PM
From: jach  Read Replies (1) of 61433
 
<<The premise was that you could buy 1 in the money call and sell 2 out of the money calls, for every
100 shares owned, and break even on the transaction price.

You are correct in that the price structure often does not allow one to break even on the transaction.

To continue the study, we assume that you bought 1000 ASND at 35 and it is now at 25. If you buy 1000
ASND now at 25, your new breakeven is 30, as you have "averaged down. Your "cost" is $25,000 plus
commission. Perhaps "cost" is not the proper term, but your "cash outlay" is $25,000.>>

My opnion is that with many possibilities of where the stock is going to go for the near-term (and where it's going to end up at expiration) do not lend well to this theory.
One fairly good method is that if there is or are stocks that one
wants to buy now then instead of buying to sell the equivalent
of option contracts for the shares.
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2025 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News