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Strategies & Market Trends : The Covered Calls for Dummies Thread -- Ignore unavailable to you. Want to Upgrade?

To: jaytee who wrote (1911)	8/10/2001 7:49:12 PM
From: BDR	Respond to of 5205

<<Secondly, am I better off with the FEB 7.50's instead?>> I don't know that I or anyone here can tell you what is best. The Feb 02 5's are almost all intrinsic value. The 7.5's have a greater proportion of time premium but neither carries much. The higher the strike price the less capital at risk and the greater the leverage but also the greater the risk of losing all of it. Since PWAV looks like it has traded around 7-10 in the not too distant past, you could be looking at losing much or all of your capital with the 7.5's. I know nothing about PWAV and would not take either position at the moment just to get the yield. Perhaps if I knew more about the company I would do something different.