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

To: Allen Furlan who wrote (15059)	8/5/2002 10:51:41 AM
From: Jurgis Bekepuris	Respond to of 78526

Allen, >Are you familiar with the term "notional value" as it > applies to derivatives? No. >I have jnpr 01/03 200 calls naked and assume that >the notional exposure in each option is $20,000, >although my exposure is nil(<$5). I assume you meant that you sold JNPR calls naked. You are right. At current price your exposure is nil. BTW, this does not apply to Dell. They are in naked put in the money situation and will have to pay unless stock goes over $45. >If this is meaning of notional then it would be very > difficult to discern just how much risk JPM really has. Agreed. Even more difficult, since JPM may have more complex derivatives than just plain puts and calls. That's one of the reasons I try not to invest in financial companies. Unless their integrity is beyond doubt, it is very easy for them to go bankrupt in a week without anyone noticing anything wrong. Jurgis