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Technology Stocks : Rambus (RMBS) - Eagle or Penguin -- Ignore unavailable to you. Want to Upgrade?

To: richard surckla who wrote (31208)	9/30/1999 12:46:00 AM
From: pompsander	Respond to of 93625

Richard....there is one simple way to make some money on options which has worked for me very well, albeit in the roaring 90s. I have simply bought hugely out of the money leaps on stocks with proven growth rates of over 15%. I hold either to the month of expiration if the stock is well in the money, or sell when it has reached a point where the gain is reasonable and the future less so. Now, in a less bullish market it would have been possible to have had the calls expire worthless and lost my premium, but stocks like Intel, Cisco, EMC and even Fannie Mae have not let me down. Many will tell you that this is tying up capital inefficiently, and they may be right, but as a simple, very liquid, option play on companies I believe in, it has worked. Very simple, low leverage concept.

To: richard surckla who wrote (31208)	9/30/1999 7:51:00 AM
From: Guy Peter Cordaro	Read Replies (1) \| Respond to of 93625

Richard: If you only sell covered calls you almost always make money. The problem is that you also limit your profits. I sold the August 105 back when Rambus hit its high of 117.25 and received 18 dollars for them. Then as the stock settled back to about 100. I closed the position for about 2 dollars thus reducing my cost of the stock by 16 dollars. The risk that I ran was losing the stock for 105 plus the 18 premium if it went higher. I try to employ this strategy on large volume days with large up side runs.