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Technology Stocks : Amazon.com, Inc. (AMZN) -- Ignore unavailable to you. Want to Upgrade?

To: Bilow who wrote (811)11/19/1997 6:09:00 PM
From: Don Westermeyer  Respond to of 164684
 
Carl,

High spreads - another good reason I don't play with options, especially way out of the money ones.

I think naked calls would be far too much risk for me to take to have any significant position. I imagine a broker would not let a naked be done with margin either (not saying that it would be good to use margin in such a case). I am wondering what the BS model values the options at though.

I'm perfectly happy to tackle this pig without the added leverage of options!

Don



To: Bilow who wrote (811)11/19/1997 6:10:00 PM
From: John Xu  Read Replies (1) | Respond to of 164684
 
I agree with Carl that selling naked calls is a good approach with
options that carry high premiums. For example, DEC 55 calls sells
for 3+. If the market runs against you, then you end up short AMZN
at 58. Not bad an entry point. Otherwise you pocket in the premiums.

My primitive TA knowledge also tells me that AMZN is forming a
H&S. Of course until this bursts, you will never know for sure.

John


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