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

To: Jill who wrote (2243)	2/4/2000 12:14:00 PM
From: edamo	Read Replies (1) \| Respond to of 8096

jill "bad for calls" again all is relative....best to buy ditm when oversold, but if upside move causes inflated volatility, the an exaggeration in call premiums will occur....the downward move may in fact cause the sometimes extraordinary call premium to deflate when it normalizes.....the only question you must ask in a call buy is simply "will the price of the underlying ever be above the option strike plus premium paid prior to expiration" if the answer is yes, set the position at a price that will satisfy you. can't catch the top or bottom....

To: Jill who wrote (2243)	2/4/2000 12:30:00 PM
From: edamo	Respond to of 8096

jill..."risk of put selling" there is always a plethora of comments on the risk,foolishness and loss of opportunity in put selling. if one grasps the timing of put selling, it most times leads to a profitable event. take advantage of "events", and oversold conditions... 1/14 sold 40 x lu-nk (lucent feb55) at 4.25 common at 53.75 2/4 bought to close the position at .75 common at 57.75 net gain in option trade 3.5 net versus increase in common of 4.......... lu trading higher, could have waited for expiration, but at this level, prefer to release capacity versus squeezing the final .75 formulae and calculations have merit, but intimacy of the price action assures some profit.