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Technology Stocks : How high will Microsoft fly? -- Ignore unavailable to you. Want to Upgrade?

To: Morgan Drake who wrote (24312)	6/18/1999 12:18:00 AM
From: taxman	Read Replies (1) \| Respond to of 74651

"Any suggestions" just go ahead and exercise. that's what i did when they told me the same thing even though my strike price was less than 50% of market value. no further request for money was ever made and i've been carrying the stock in my margin account ever since. regards

To: Morgan Drake who wrote (24312)	6/18/1999 12:29:00 AM
From: t2	Read Replies (3) \| Respond to of 74651

Morgan Drake, Your logic seems OK to me. You should be able to exercise these options anytime before expiration (but why do it?). The problem could be related to the size of the order itself and the fact that exercising before expiration is very unusual. The guy on the phone and some levels of management may just not to assume responsibility in giving the green light. Expect to get the go ahead tomorrow(just my guess). What is the rush anyways? You could just as easily wait til expiration and you won't have to pay margin interest either. Maybe that is the problem--your request to buy on margin may not make sense in the first place and that is why there is some confusion. Maybe that is why they don't have a written policy on such a situation as the proposed transactions does not make sense. If you had been buying only with cash, it would make sense. Just my guess as i don't usually exercise options. Good luck.

To: Morgan Drake who wrote (24312)	6/18/1999 1:13:00 AM
From: ed	Read Replies (1) \| Respond to of 74651

Well, I have an answer for you to solve your 1.2 Million problem. How are you going to pay me for the consulting fee ? Sell 10000 shares of your option at market open tomorrow morning, and assume the stock price is still $120. You will have a profit of $600000 with strike price of $60. For the rest of 10000 shares , hold it till the end of expiration and exercise them with the profit of the first 10000 shres sold as option. Then after you exercise the rest 10000 shares at the expiration date , the 10000 shares in your account will have a market value of at least $600000, if we assume the stock price will continue go north between tomorrow and the option expiration date. After you exercise your second 10000 shares, then buy back the 10000 shares on margin , which you sold tomorrow as an option. So, you will end up with 20000 shares in your account with 50%. However, you will need to pay tax on the profit of $600000 which you generated when selling your first 10000 shares as option, which is around $170000 by April 15 of year 2000. So, technically speaking , you make a loan of $170000 from Uncle Sam to exercise your 200 contracts, and you need to pay back the loan by April 15th of year 2000. With 20000 shares in your account, you can make that amount if stock goes up another $9 . Well, you still have 10 months before your loan is due, QCOM may go up much higher than $9 !!! Congratulation. I do this to my Microsoft holdings too!!!!!!!! This is the best strategy to get into stocks.