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To: IQBAL LATIF who wrote (28943)9/23/1999 8:15:00 AM
From: Rich1  Read Replies (2) | Respond to of 50167
 
In your MSFT scenario you would sell the Jan 110 calls for 3 5/8 and buy the Nov 85 puts for 1 9/16. This limits your downside if the market corrects and gets you 113 5/8 for a $96 stock in which case you would also have to pay Uncle Sam his 35% or buy the calls back if the stock somehow goes over $110 before January.
Similarly CSCO you would sell the Jan 80's for 3 5/8 and buy the Nov 65 puts for 1 7/8. Am I correct? TIA