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Politics : Formerly About Advanced Micro Devices

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To: Gary Ng who wrote (60435)6/3/1999 10:36:00 PM
From: Elmer  Read Replies (1) of 1582694
 
Re: "BTW, what kind of of free money one can get ? I believe each contract needs to be secured by 100 share worth of free cash of the underlying stock so it sounds to be a pretty small amount(well I know nothing about this game)."

Puts can be secured by cash or margin balance. In the case of cash, it continues to earn interest as well. In the example of AMD June 17 1/2s, the bid is 11/16. That equals about 4% of the potential risk for 2 weeks exposure, or an annual rate of about 94%. Not bad if you are willing to take the risk of being assigned AMD @17 1/2. Not bad at all if you are thinking of buying AMD anyway. With assignment your cost would be 16 11/16s. My hunch is the K7 hype will keep the stock afloat. Your mileage may vary... Batteries not included...

EP
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