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

To: TimbaBear who wrote (12133)	2/26/2001 11:39:57 PM
From: Mark Adams	Respond to of 78470

CEGE cost basis before the call was about 16 3/4. So the after call basis is closer to $14 than $13. If called, the return is 21% after commissions, annualizes to >50%. I added a second 50 shares to bring it to a round lot at 15 5/8 a couple of days ago. The weakness in the shares prompted me to look more closely at their cash position. That brought the cost basis down on the first 50 shares. I'd like to see rich premiums and high volatilities before writing calls. I'm finding that on many issues, the downtrend has minimized vols on stable mature stocks that I prefer to hold. Something like CEGE is awarded an Implied V of >90%, but even that is down from 180% last year. I saw the move in ABGX, quite impressive. Shame CEGE not moving on it's own merit. I was about to dump CEGE due to the revelation of the real net cash numbers at breakeven, but decided to write the call instead. It's not the only companey working the anti-cancer angle (GERN, AVII and probably others) and I believe I'm exposed to it through the HQH closed end biotech fund. I'm not qualified to evaluate biotech efforts, so it makes sense to let a fund manger (HQH) help out. Plus, they are exposed to private placements in companies not public yet, which I couldn't play if I wanted to. Being not qualified doesn't prevent me from playing favorites in the sector anyway, but I try to limit my exposure.