Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Gorilla and King Portfolio Candidates -- Ignore unavailable to you. Want to Upgrade?

To: Mike Buckley who wrote (44002)	6/30/2001 10:53:06 AM
From: tekboy	Read Replies (1) \| Respond to of 54805

the point you're making is that the Jan 04s are less than half the cost per month than the Jan 02s and that is to be expected. Not having run the numbers, I didn't realize there would be such a difference in cost. I'm impressed. I'm the last one to be talking on this subject, natch, but might your surprise be due to overlooking a key part of the equation, which is the greater upside potential of the 02s over the shorter term? I mean, there's rarely such a thing as a free lunch, so the difference in price must necessarily be largely correlated to a difference in either risk or reward. Since the risk is actually lower for the 04s, the missing factor here must be that the 02s would provide a significantly greater reward should the stock go up a lot between now and January, and that potential reward is what some, uh, reckless gambler types might be willing to pay through the nose for... tekboy/Ares@can'timaginewhowouldeverdosuchathing.com

To: Mike Buckley who wrote (44002)	6/30/2001 11:13:35 AM
From: Uncle Frank	Read Replies (1) \| Respond to of 54805

>> That explains why I was confused ... by making me even more confused. Some things are better left alone. :) Only politeness constrained me from making the same comment about some of the more esoteric issues you valuation junkies have raised recently :-). I'm sure some of the gang feel the same way about technical or marketing discussions. But that's the very reason why shared dd has been so valuable to regular readers of this forum. >> I didn't realize there would be such a difference in cost. Roth is probably turning over in his grave. The easily calculated difference between the monthly "rental fee" for longer term derivatives versus their shorter lived cousins is the only reason for the existance of LEAPS. uf