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

To: surpow who wrote (1879)	1/29/2000 8:37:00 AM
From: Poet	Respond to of 8096

Interesting question, Noah. I'll give my opinion, but please know I'm no math whiz and there many others who would be able to break down the numbers better than I. First, I think it might be wise to do as you're thinking -- rolling your calls down-- despite the fact that you'll be able to buy less calls with the proceeds of the sale of the first bunch AND despite the fact that you'll have added fees (the sale of the first bunch and the purchase of the second). DIM options have higher deltas than OTM options, hence the value of theyour DIM calls moves almost point-for-point with each point rise in the underlying stock. OTM calls have lower deltas, so for each point the underlying stock rises, their value rises only .3, .4, .5, etc. Another idea is to keep the July 175 calls you have and sell covered calls on them, then take the proceeds (the premium you got from the cc's) and buy some DIM LEAPS. Unfortunately, QCOM has fallen so much since you bought the July calls, that the premiums have wasted away terribly. I'd love to hear some input on this issue from others who are more experienced in option repair than I. And Noah, I wish you luck. I think it's smart of you to be willing to reposition here rather than just waiting things out until July. Wish I could be more helpful at this point.