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 : Paint The Table -- Ignore unavailable to you. Want to Upgrade?

To: John Pitera who wrote (2369)	11/16/2001 9:21:54 PM
From: Patrick Slevin	Respond to of 23786

Naturally the stock would not be able to accelerate upward too much as the Bond would be called around 123 or so, depending on rates. I've always had good luck with them, however, because I usually wait and buy them depressed. 80, 86 for example.So the artificial trade never really occurred to me, although it makes a lot of sense. There is always a flaw in any given argument, of course, and I think in the Buy-Write scenario you could get a bit hurt if the underlying did not achieve that breakeven number where they call the bond. So you may be hung out to cover or buy stock to meet the Call, yet insofar as the stock stalled before the price where conversion is made your yield is cut back. Perhaps by writing a LEAP you could get around that, as with a LEAP you may be able to write at a price where the bond would be converted.