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Technology Stocks : Dell Technologies Inc.
DELL 119.41-2.7%3:59 PM EST
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To: SecularBull who wrote (112167)3/25/1999 11:03:00 AM
From: PAL  Read Replies (1) of 176387
 
LoD:

As Don said in his previous post, you don't have to roll it on the same stock. Let us just say you have May50 put on XYZ (I am not going to use Dell as an example). It becomes deep in the money because XYZ is almost bankrupt. The value of the puts is approaching the strike price. You can sell LEAP Puts Jan01/150 CMGI, to generate cash to buy back the put on XYZ (while it still has time premium).

1. You declare a loss on your Schedule D for that XYZ option (you need that anyway, especially in your case VBG)
2. Your cash account at least remains the same (generate more cah from CMGI to cover XYZ)
3. Now this is a great country or what?

Remember the 2 rules from edamo. The stock must be a dynamic stock (like Dell, MSFT etc).

Good Luck

Paul
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