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Technology Stocks : BORL: Time to BUY!

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To: i-node who wrote (1457)1/29/1997 2:10:00 PM
From: David R   of 10836
 
I am not real familiar with calls so help me to understand this.

I buy 1000 options at 7/8 or 987.50, to buy Borland at 10 in Jan 98.

Obviously, if the stock goes to 15, I make a lot of money ($5.00 per option right).

Am I correct in assuming that if the price is $10 or less, I have lost my dollars?

Typically, what would value of the options be if BORL is at say $12 six months from now? What circumstances would be neccesary to get at least 1/2 of what what they are currently worth?

What would the value of the options likely be in 6 mos if the stock is still 5-6?

I guess I see owning BORL as a much safer bet than the options, unless there is a real possibility of BORL going belly-up in which case they are both worthless. But then, with options I also see a possiblity to make a very good return on a very small investment (if I am willing to risk all of that money). A lot to think about!

Anyway, thanks for the info.
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