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Politics : Formerly About Applied Materials
AMAT 261.90+0.4%Dec 26 9:30 AM EST

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To: Jacob Snyder who wrote (13509)12/17/1997 2:21:00 PM
From: Paul V.  Read Replies (2) of 70976
 
Jacob, >I've never bought options, I'm just thinking and doing numbers. I'm trying to find a least-long-term-risk, greatest-long-term-reward strategy. Could some of the more experienced people tell me, are these numbers accurate? Are these assumptions realistic?<

I have done exactly what you have suggested--buying on margin. But, we have to factor in interest due, which according to my CPA is deductible, and possible downside of a margin call either created by a pullback in amat prices or an increase in the call percent, i.e. 30% increase to 40 or even 50%.

My margin purchase was at $16.05 so I have sufficient protection. IMHO, the upside risk far exceeds the downside risk.

As Tito's leaps what are the additional costs and are they deductible on ones taxes?

As I indicated in another post--stay away from a margin call!!!!

Just my opinion.

Paul V.
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