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.

Technology Stocks : Full Disclosure Trading -- Ignore unavailable to you. Want to Upgrade?

To: Sam Citron who wrote (9447)	11/22/2004 7:04:13 PM
From: Alastair McIntosh	Read Replies (2) \| Respond to of 13403

O.T. Sam, the reason for choosing a strike near the current price is a matter of my perception of risk. For example, had I chosen to sell the 25 strike puts and calls (for about $14) and the data had been perceived as positive the stock could easily have jumped to $45 which would have resulted in a call price today of over $20 and a large loss. Even a move to $40 would have resulted in a loss as the calls would have been priced at about $15. I can't conceive of a situation (other than inside information) where it would be wise to not sell the options for a strike close to the current stock price. As far as timing goes, I did not expect trial results so early. I expected to pocket some time premium over a couple of weeks. However, the drop in implied volatility today worked for me. As you noted, a big factor is the timing of trial results or FDA approval decisions. Some information is here: thestreet.com