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Technology Stocks : Cisco Systems, Inc. (CSCO)

CSCO 72.11

-0.3%

Nov 5 3:59 PM EST

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To: Gerald Walls who wrote (20435)	1/7/1999 8:00:00 PM
From: manohar kanuri	Read Replies (1) of 77397

If the LEAP has a ways to go yet until expiration they you'd probably lose too much time value by exercising so you'd sell. For a leap that deep in the money, with even a year to expiry, it's very likely that the bid is just a dollar or two above the stock minus exercise. Of course you could always take some profits by rolling the LEAP to a higher strike which will be cheaper but then you still owe the taxes. I'm not sure why a higher strike would be "cheaper"? Or do you mean just absolute dollars? In any event, another alternative is to write out-of-the-money calls (against your leaps) and hope they expire worthless rather than get called. You can always buy that higher strike if it does get called away and still come out ahead with a lower absolute dollar exposure. jmo fwiw.... mano

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