Altaba Inc. (formerly Yahoo) Message Board

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Technology Stocks : Altaba Inc. (formerly Yahoo)

AABA 19.63

0.0%

Nov 6 4:00 PM EST

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To: IKM who wrote (5148)	12/29/1997 1:49:00 PM
From: Oeconomicus	Read Replies (1) of 27307

IKM: why in the world would someone open a position 29 points in the money? There's little of the leverage and all the decaying time risk of options ... That far in the money and with little time premium, the option is the stock. In any case, whether it was "sell to open" or "sell to close", the seller would appear to be bearish. What could the buyer be thinking, unless they wrote them at $10 and have run out of money with which to ride it out? Barb: I never let the tax tail wag the dog. Especially on a volatile stock like Yahoo!. I'd rather pay the taxes on a locked in gain than put off paying the taxes on what could end up substantially less. My guess is that, by writing these options, someone is having their cake and eating it too. You can't defer taxes with a short against the box any more, so write deep in the money calls. Bob

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