Apple Computer (AAPL): Analysis and Forecasting Message Board

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Technology Stocks : Apple Computer (AAPL): Analysis and Forecasting

AAPL 255.48

-1.1%

Jan 16 3:59 PM EST

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To: nedlo who wrote (242)	7/12/1998 10:16:00 PM
From: soup	Read Replies (1) of 692

>I was thinking of investing heavily on Monday @ 32$, What's your call on Thursdays potential< nedlo; No rational person on these boards should attempt to advise you on such a heavy bet. Notwithstanding AAPL's earnings, the market's pretty toppy and Steve Jobs could fall out a helicopter between now and Thursday. Also figure that the market may have already factored in the AAPL's 3Q earnings news into the current price. That said, a very limited speculative bet on in-the-money July $30 calls [AAQGF] at 2 7/16 probably offers little downside risk (assuming the stock stays where it is) and some good percentage to the upside on a modest share surge. Coversely, betting on July 32 1/2 calls [AAQGZ] at 15/16 could easily lose you 100% of your investment (assuming the stock stays where it is) and make you no money until AAPL shares go past $33 1/2. In either case I would resist the urge to chase if we see a big surge Monday morning. I that happens, I would take some equity position with a multi-year time frame. Of the long term calls, I paid too much for Jan 2001 $30 @ $10 last April (Have to get to $40 to get even.) I'd have done much better to get them at $7 when AAPL was swooning in the mid 20's. But, if AAPL gets to $60 by expiration, I will have tripled my money with the calls vs. only doubling it with actual shares. On the other hand, if you buy AAPL shares and sell covered Jan 2001 $30 calls @ $10 3/4 (and hold the shares till expiration) you lock in a 13% rate of return for 2 1/2 years. Not too shabby!! Good luck.

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