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Technology Stocks : Qualcomm Incorporated (QCOM) -- Ignore unavailable to you. Want to Upgrade?

To: Caxton Rhodes who wrote (35529)	7/17/1999 10:28:00 PM
From: Morgan Drake	Read Replies (2) \| Respond to of 152472

OPTION HOLDERS BEWARE!!! Almost had a coronary yesterday afternoon. Listen up and pay attention, this could happen to you (or may have already happened and you don't know it yet). Logged on to ETrade yesterday a.m. and found the following account alert message posted to me by the Margin Dept. "You have in the money call options set to expire tomorrow. Please close out your position or fund your account. Thanks. Margin Dept." I was clueless as to what they were talking about. I was holding 186 July 60 Qualcomm Call Option Contracts, when the stock was trading in the high 150s. I figured that they this was some sort of mistake, as the new ETrade system had just kicked in. Nevertheless the message was discomforting and knawing (sp?) at me all day. I figured I would check into it later at my leisure. Around 3:15 p.m. yesterday, I again logged onto ETrade. Lo' and behold, I had about $900,000 of cash/option purchasing power and about $1.8 mm in margin purhasing power. Again, I figure that these guys are crazy because according to my calcs, the number was more like $50k in cash/option purchasing power and $100k in margin power. While I'm scrolling down the page and reviewing all this stuff, up pops two new flashing alerts in real time which state the following: "36 July 60 QCOM sold at market - $98 3/8" "50 July 60 QCOM sold at market - $98" I almost dropped dead. That's where all the new purchasing power was coming from. I was facing a $350,000 + short term capital gain tax and was losing my QCOM leverage. I immediately called ETrade to find out what the hell was going on. I got a rookie customer service guy and informed him that he better find a senior player and do it fast. I'm on hold for about 4 minutes. Guy comes back on the phone and says "Our Margin Dept. made a calculation errror. We thought you were going to get a Fed Margin Call, so we liquidated your positions. However, we're going to "break the trades" and put you back to the status quo ante." All this is on tape, so I'm quite relieved. My account shows that they rebought the 36 July 60s at 98 3/8 (I better not get charged for the 3/8). Apparently they were not able to break that trade. No transaction history on the remaining 50 July 60s, so I presume that they were able to break that trade. My account shows that I am 3,100 shares long QCOM and have 186 July 60s remaining in my account (what I'm supposed to have). I am also not showing any "realized gain" on these positions for tax purposes. Hopefully, tomorrow's account positions will show that all remaining option shares were exercised properly. Will keep you posted. In the meantime, it wouldn't hurt to double check your positions if you also were holding options exercisable today. Morgan