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Technology Stocks : Atmel - the trend is about to change -- Ignore unavailable to you. Want to Upgrade?

To: hpeace who wrote (7491)12/5/1997 7:21:00 PM
From: Hanney Yin  Read Replies (1) | Respond to of 13565
 
In order to make a profit for 20 puts, the atml price would go lower than 16.50 to break even (20-premium 1 3/4 preimim put -1 3/4 premium for call) which does not even include the commision part. my lowest estimates is 1.36 (this year's eps)@ 12.3 (the mean of last five years low pe) which equals 16.7. How can you profit from 20 puts on when eps for 98 might be above 1.36?

Thanks
Yin



To: hpeace who wrote (7491)12/5/1997 8:00:00 PM
From: Hanney Yin  Read Replies (2) | Respond to of 13565
 
Steve, multiple choice

a) bull spread w/ puts buy 20, sell 22.5 dec
b) stradle 20 puts and 20 calls on Jan

my answer will be b, and I've completed the execution of answer b, too.

Thanks


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