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Technology Stocks : Micron Only Forum

MU 244.90

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3:59 PM EST

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To: H.Jablomey who wrote (46013)	5/27/1999 3:40:00 PM
From: John Graybill	Read Replies (1) of 53903

Here's how you turn some of those losses into gains: If you get a nice sharp move in your direction, sell the next strike and then just wait for expiration. Example: Let's say that yesterday you had bought June 32 1/2 calls at 4 3/4. Today, after the sharp move up, you could have sold June 35 calls for 4 7/8. Now you have all your money back in your pocket and the chance to pocket $2.50 if it closes above 35 at expiration. The big question you would be asking yourself now would be whether you want to take a 30% profit in a day and be done with it (you could sell the 32 1/2 calls for $6), hold on for more profit but possibly lose the 30% and your initial stake on an overnight gap, or go for the limited profit of $2.50 with no chance of loss. This is my favorite option strategy.

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