3Com Corporation (COMS) Message Board

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Technology Stocks : 3Com Corporation (COMS)

COMS 0.00160

0.0%

Jan 16 9:30 AM EST

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To: joe who wrote (20363)	8/10/1998 7:25:00 PM
From: Eric L.	Read Replies (1) of 45548

Joe, You thoughts are sound! Pretty scary, huh? Options by there very nature limit both your up and downsides. You best case senerio is that coms is trading at 24 and change when they expire and quickly bump back up. That means you keep both the stock and the $4K. If you held the stock you'd need coms to hit $32/share to equal the return and any above $32 is gravy. The question you need to ask is, "Will COM$ be trading at or above $32 by the end of Sept?" Another interesting point is that if Sept 25's are truly going for $4 at the close of today (I'm not sure, haven't checked) that is not much of a premium-15/16 as of close today. What that would tell me is that people are not willing to pay much of a premium for this option even though its "in the money". That wouldn't be as attractive for me to lose control over 1000 shares. On the other hand.... For example, C$CO Aug 100 calls are trading at 2 1/4 -2 3/8 at todays close of 99 3/16. That means they are trading at almost a $3 premium with less than 2 weeks left til they expire! That wouldn't be a bad premium. Anyways, just my thoughts. Good luck! 3CB!

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