Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: Jurgen who wrote (51235)	11/20/1999 8:41:00 PM
From: eikos	Read Replies (2) \| Respond to of 152472

QCOM Puts might work Seems like a good idea if one is bullish to neutral on the stock and prepared to buy it at the strike. Sure it can go down, and the put writer must take the risk just like the stock buyer. This is better than buying the stock outright because the put writer has a cushion on the downside equal to the option premium he received. Of course if the stock continues skyward as QCOM likes to do, the put writer pockets none of the gains. But he does get to keep his put money. Some people who fear the possibility of that the stock could collapse refuse to run the risk of writing a put. And then they go out and buy the stock!!! Makes no sense from a standpoint of risk. But I know the selling of naked puts is viewed as quite risky by the houses and usually forbidden in retirement accounts. Obviously, if one doesn't have the cash to buy the stock and the position moves against him, he's in deep trouble. I guess the same sort of trouble naked call writers on QCOM must be quite familiar with by now.

To: Jurgen who wrote (51235)	11/21/1999 3:45:00 PM
From: freeus	Read Replies (1) \| Respond to of 152472

re what if the stock goes to $200? Yes, of course that is a risk: I have the sold put in a margin account so I would just have to buy the stock at that price...but if I would have bought it anyway (and I do own Qcom stock outright), then this is a "cheaper" way to get it (on the same day, anyway) and a way to make money off the stock if I do not get assigned the shares...which is generally what happens. And of course if one get nervous one can buy the put back at a loss...as I did with Nite. But most of my puts expire worthless, and I use the gain from the put sale to be able to buy more of the stock I like. Like Qcom. Freeus