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Politics : Ask Michael Burke

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To: eddie r gammon who wrote (53997)3/31/1999 2:21:00 AM
From: John Graybill  Read Replies (2) of 132070
 
Nope, calls are cheaper only because MU is lower. Unlike the puts, the main loss in the calls is because MU itself has dropped.

Example: MUDW (47.5) was 3 7/8 x 4 1/8 on 3/30 with MU at 47 3/4; today it is 2 1/8 x 2 1/4 with MU at 45 5/16. That's a loss of 1 3/4 on the option compared to a loss of 2 1/2 on the stock. That's some loss of premium, but no more than 1/4. Not comparable to the collapse in the puts.
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