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To: Condor who wrote (34284)2/27/2007 1:43:46 PM
From: koan  Respond to of 78431
 
WPM wrs ,

if you sell them the first full year you will get almost your entier purchase back (even if the wts are still out of the money)as time and leverage value remain pretty constant for the first couple years in 5 yrar wts, regardless if it is out of the money (just depends how low, but if the wts are lower so will the stock be lower (so you still lose)and in fact the stock would have gone down even more in this case!!)(the time and leverage are a sort of constant (as long as stock pricer reamins static)when there is a lot of time left and reamin so until about a year to 18 months ahead of expiraction and the a and b wts are 3 and 4 years out.

The idea that if everyone just buys wts the whole thing will not work. This is a silly idea and I will present that statement to the author as his koan-lol.



To: Condor who wrote (34284)2/27/2007 1:50:24 PM
From: TheBusDriver  Respond to of 78431
 
Cool had not seen it that way before but I can see how that is possible....anyway I would prefer EPM at around $1.50<g>....

EPM is the only green in my PF today....oil must be down hard too.....