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: Rational who wrote (5195)	12/29/1997 9:11:00 PM
From: Mama Bear	Read Replies (2) of 27307

Sankar, you're not accounting for the time premium. As far as selling deep in the money calls it's just a way to short the stock, but only put up $29 to buy the call rather than 34 1/2 to short the common. The 40 calls will move almost dollar for dollar with the stock, the 60s will not. If the common moves to 60 the 40s will drop to close enough to 20, while the 60s will still fetch ~4. Gotta pay for the time when they're close to in the money or out of the money. You just need a little better understanding of Black Scholes. Barb!

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