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Strategies & Market Trends : Options -- Ignore unavailable to you. Want to Upgrade?

To: taxman who wrote (600)	1/3/2000 8:46:00 PM
From: codawg	Read Replies (2) \| Respond to of 8096

taxman, Maybe it's clearer if we think of stocks first. If I have $100k worth of MSFT in my margin account and no cash I can buy up to $100k of CSCO. Even though I am borrowing 100% of the purchase price for CSCO. The 50% seems to apply to the entire account equity - not to the purchase price of the CSCO transaction. If not, I would have to come up with another $50k to buy CSCO. This is how my margin accounts work (3 different brokers), is it the same for yours? In other words, I have $200k in securities, and 100k (or 50%) in account equity. This would seem to be no different from exercising options. After I exercise options that have doubled from the strike, I have 50% in account equity. Co