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Technology Stocks : Amazon.com, Inc. (AMZN) -- Ignore unavailable to you. Want to Upgrade?

To: Mark Fowler who wrote (114433)	1/5/2001 9:52:26 AM
From: H James Morris	Read Replies (3) \| Respond to of 164684

Mark, right now I'm buying puts on the BKX. I also started shorting selective bank stocks. I can remember the time when CitiBank and BofA almost went busto. Both their stocks were trading in single digits. I'm assuming BofA is venerable right now. Btw Bought Morgan Stanley april 90 puts at 11 and change.

To: Mark Fowler who wrote (114433)	1/5/2001 12:47:04 PM
From: H James Morris	Respond to of 164684

Mark, why did you buy Amzn stock instead of the bonds? >This mix of characteristics makes converts a lot more complicated than plain-vanilla stocks and bonds. But in some cases they're worth the trouble. Say, for instance, you think Amazon.com (AMZN:Nasdaq - news) has emerged from the Christmas selling season as one of the few viable pure e-tailers. But you wouldn't be surprised to see its stock fall further if we slip into a mild recession this year. Instead of the stock, you could buy its 6.875% convert that matures Feb. 16, 2010. This bond is rated CCC+ by Standard & Poor's, which puts it in the junk category (though it's still a lot safer than the stock). It converts into 9.5 shares of Amazon stock, which isn't much, considering that Amazon now trades at only $18. But the bond has fallen along with the stock, and at the current $400 per $1,000 of face value, now has a current yield of around 17%, and a yield to maturity (when the company gives you back the face value) of 22% a year. Scroll down through ConvertBond.com's analysis and you'll find a table showing the effect of movements in Amazon's stock price on the bond's return: If the stock drops by 50%, you lose only 13%. If it rises by 50%, you gain 15%. So this bond's immediate attraction is primarily the high yield.