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Technology Stocks : Novell (NOVL) dirt cheap, good buy?
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To: DavidD who wrote (23794)9/9/1998 9:24:00 PM
From: DavidG  Read Replies (2) of 42771
 
David,

I have not followed the call options that closely so I can't say whether they are more overpriced now then before. IMO i believe options are usually somewhat overpriced all the time, and that it is why most lose with them. On the surface though they do look a little higher than they should be, but maybe you can look at them and decide.

cboe.pcquote.com

I tend to believe that, as you suggested someone negotiated a large block at the 5/8 price... but to sell maybe as a covered call while at the same time or close to it make a purchase of an equal quantity of the equity...just a guess. Then if NOVL closes in 5 months at 15 or greater the profit will be 4 pts appreciation plus 5/8 premium for approximately a 40% profit...not bad.

15 to 16 looks like the next overhead resistance point also.

DavidG
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