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

To: Jill who wrote (55297)	12/20/1999 10:09:00 PM
From: Farfel	Read Replies (1) \| Respond to of 152472

The "delta" changes on an option the "deeper in the money" you happen to be. The delta is the rate of change between the value of the option v value of the stock. I have found that with a very volatile option like Q, the delta usually "tops out" at about 80% or 80 cents on the dollar----with slower volatility an option can approach 100%, but Q seems to move to quickly to get to that point. Yet, considering that you only pay $13,000 to get to that 80% return on a stock which would cost you $46,600----that is a pretty good deal. Actually I have seen that if Q returns even 10% of what it did this year: 130% then the stock would be worth $1071 dollars by expiration next year----that would mean your Leap, purchased for $13000 would be worth $61100 upon expiration ($1071 - strike 460= 611 (times 100 shares) so your profit would be $61,100- $13000 (cost of option) or $48,100------not bad!----that's a 370% return on investment and that is if Q only does 10% of what it did this year-----can you even imagine what it would be if Q does 1/2 as well as this past year??? $3495 a share - 460 (strike price)= $303,500 minus the initial investment of $13000 = $290,500 on a $13000 investment; that's only 2,234% return on investment----but then Q couldn't possibly go up another 650% this coming year, could it??? or could it???? Farf

To: Jill who wrote (55297)	12/20/1999 10:22:00 PM
From: Uncle Frank	Read Replies (2) \| Respond to of 152472

Farfel did a great job of analyzing the 430 strike LEAPS for you. Let me add one thing: The 380s were up 46 points today, the 430s up 18. Sometimes the ticker report doesn't make sense. The 380s were assuredly not up 46 points on a less than 12 point rise in the common. What happened is the 380s didn't trade for several days and what you see as +46 is a multiday gain. If you look at the open interest, you'll see these expensive leads are very thinly traded. >>I wonder whether it's wiser to buy now, or to wait for a post-split post Jan 1 dip, if there is such a thing. Now that's the $64,000 question, isn't it. I know this will draw howls from some of the common call/put players, but IMO, you should buy now and ignore the possibility of a dip. After all, these are multi year vehicles. What price do you expect Q to be in March 2001 when they should be sold? jmho, uf