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Technology Stocks : CMGI What is the latest news on this stock?
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To: Magnifique who wrote (4810)2/15/1999 10:12:00 AM
From: B. A. Marlow  Read Replies (2) of 19700
 
Good points, Magnifique. Options illustration was to make the point.

Premium used was nominal midpoint between bid and offer at the close. Don't merely write at bid and sell at offer if at all avoidable; volatility allows plenty of daily movement. MMs will take advantage, so let deals come to you. Use "cancel and replace" if necessary.

With options, especially on Nets, you do have to allow for runaway scenarios. The good news, once again, is volatility. Should CMGI sell off this week, it will be back. If this happens, you can write the March contract after expiration. Or, if you expect an imminent sell-off, write a lower Feb. strike in the first place.

BAM
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