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Strategies & Market Trends : Gersh's Option trades -- Ignore unavailable to you. Want to Upgrade?

To: Gersh Avery who wrote (608)	12/11/2005 10:49:07 AM
From: Mark Johnson	Read Replies (1) \| Respond to of 652

This board has been a little quiet. One could argue that I have little margin to make any more option trades right now but the following is a good trade I think. finance.yahoo.com The GM january 10 puts bidding around 5 cents. GM's problems are really bad I don't think they will file a bankruptcy in Jan. If the stock drops down and if anyone can sell the options for 10 to 15 cents. That would be a really good trade. I rate this a 9 on my scale of 1 to 10. 10 being the best. A 5 would have an 85 to 88% chance of expiring worthless. A 9 is about 95 to 98%, scale has too many variables to explain. Super traders (aka gamblers)can sell the GM 32.5 calls and pick up an extra 10 to 15 cents. This puppy is not hitting 32.5 by january 20th. Too many unknowns for GM. Further pricing erosion is coming for U.S cars. If the 7.5 puts bid 10 cents, that wouild be equivalent to printing free money in my opinion. Sorry I did not post this trade sooner. This trade, depending on commissions could earn the speculator 5 to 8%, depending on if the options were sold for 10 or 15 cents (january 10 puts). Good trading all and hope to see more options posts. Mark