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Technology Stocks : Loral Space & Communications
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To: Geoff who wrote (2111)3/6/1998 11:55:00 AM
From: ccryder  Read Replies (1) of 10852
 
Buying LEAPS now is not as good as buying them before the time premium increase is what I meant to say.

To sell or exercise? Taxes need to be considered. The two year LEAPS have the potential to be considered a long term gain if held the 18 months. So selling at that point is a possible winner. But the time premium will be nill on what will be a deep in the money option in 18 months. <<GGG>>

On those LEAPS I want to exercise, I will hold for the term. Those I plan to sell, I will do so after the 18 months when I think the price is right.

When exercised, there is no taxable event. The long term clock is restarted when you exercise and your basis for the shares you get is your total cost of LEAPS plus strike price.

I love thinking about the possibilities.
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