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Strategies & Market Trends : January Effect 2005 -- Ignore unavailable to you. Want to Upgrade?

To: semi_infinite who wrote (17)	12/29/2004 2:20:08 PM
From: rrufff	Read Replies (1) \| Respond to of 76

Interesting picks - stocks that are certainly down for the year, speculative, fairly high beta, etc. However, the Jan puts - very low premium at this point. Do you really think they are worth the potential risk with very small upside?

To: semi_infinite who wrote (17)	1/24/2005 12:57:00 PM
From: semi_infinite	Respond to of 76

Ok. Let's tally up the damage on the shorting puts approach. For simplicity I am using todays opening price on the stock underlying option as the basis for figuring delta. theoretical as posted on 12/29 amat (15.72 + 0.80 - 17.5)/17.5 = -5.6% mlnm (9.42 +1.5 - 12.5)/12.5 = -12.6% (used own option price obtained here and sndk, individual mileage may vary) qlti (0.70)15 = +4.7% (expired) sndk (23.29 +1.25 -25)/25 = -1.8% teva (27.45 + 0.95 -30)/30 = -5.3% theoretical unweighted average = -4.1% (not including trading costs) Actual (not including trading costs amat (not sold) mlnm -12.6% (assigned) qlti 4.7% (expired) sndk -1.8% (assigned and sold feb 25 calls for 0.95 on assigned shares, still have original position from around $20) teva (27.28 +0.60 -27.5)/27.5) = +1.4% (sold jan 27.5 puts for 0.60 instead partially assigned and sold assigned shares this morning for 27.28) actual unweighted average = -2.1% mileage will vary depending on timing (patience)and leverage