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Strategies & Market Trends : Point and Figure Charting

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To: kurt aichler who wrote (12523)	1/11/1999 12:15:00 AM
From: Judy	Read Replies (1) of 34811

Kurt, thanks for your kind words. The cost basis of your calls is established at strike plus prem, whether you exercise them or cash them out. If you cash out, you will owe taxes on the sales proceeds less the cost basis; if you exercise the tax consequences will come upon sale of the shares. Really your decision should be predicated on the expectation of the price action of YHOO rather than tax concerns. Personally I would exercise the number of shares I wanted for my long-term portfolio and take profits on the remainder of the contracts when YHOO starts to fatigue. Successful traders routinely pay alot of taxes, if you get my drift.

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