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Technology Stocks : Dell Technologies Inc.
DELL 119.41-2.7%Nov 19 3:59 PM EST

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To: Chuzzlewit who wrote (111835)3/24/1999 6:11:00 PM
From: edamo  Read Replies (3) of 176387
 
chuz...re confusion...on such a lovely day..

passed along numbers that craig posted...confirm...a bit less zdemq closing b/a=46.375/47.375 ....premium is above the price of the stock by about 25% due to the 85 strike...

i've used high strike/large premium leaps for years to build long positions...think it thru as i know you will...crunch the numbers..play devils advocate...consider again...

i have 8500...= my cash capacity
i sell 1 zdemq=receive 4650 premium
i now have 13150
my capacity has increased
i buy 125 dell at 38.5=4620
i still have 8530 cash..
8530 cash more than covers my put until expiration
i get free 125 dell...can write covered calls..or let it ride
if my dell long zooms...and if at 86 @ expiration i have 19250 (86x125 +original 8500)
more capacity
can sell more puts....go long and add to position
a reverse margin strategy.....and less risk than going long 222 dell today (8500/38.5)

i know you are good...this is what don martini and myself have been doing for years...very conservative..whats the risk on the original put sell/long buy....i await your keen analysis...

ed a.
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