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

To: Mark Johnson who wrote (635)	3/23/2008 11:13:17 PM
From: Mark Johnson	Read Replies (1) \| Respond to of 652

Bear Stearns, this company put many of its eggs in the subprime area but I really don't think the stock is worth more than $2 a share, the recent buyout price. I don't think any suitor in their right mind would come in and buy it for a significant premium, ya never know but it is not likely in my opinion. So, don't go full hog and short a significant amount of these options but I really like the idea of shorting the April 20 calls bidding 15 cents, asking 20 cents. The stock is trading around $6.00 a share. I think those options will end up worthless. The risk reward ratio I think is good. If buyout rumors again abound with the company, cover the options when it doubles in price, then short something else, like the april 30 calls.