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Technology Stocks : Texas Instruments - Good buy now or should we wait? -- Ignore unavailable to you. Want to Upgrade?

To: pat mudge who wrote (2720)	1/5/1998 7:26:00 PM
From: otter	Read Replies (1) \| Respond to of 6180

My two cents (about all it's worth). Tea leaf suggests TXN is heading up. Scraping upper bollinger band. Momentum is up. Stochastics seem good, and all that. Selling puts (IMO - REALLY IMO) seems not to have a lot of risk; but remember downside potential is very high. If TXN tanks, you might have to buy somebody's stock at a price much higher than mkt; or you might have to buy back puts to cover at a very high price - and your broker may require you to have reserve that you might otherwise be using. The only guaranteed winner is your broker (maybe why he/she is suggesting it?) I believe long term TXN is going up; but I don't have the fortitude to sell a put into this market. Short term, much too volatile. why not covered calls? Risk is much less because you have the underlying issue at hand. If TXN doesn't hit strike price, you've pocketed the $. If it exceeds strike price, you may be called, but you have made $,too. If you bought TXN today at 49 & sold july 55 at current price of @$5, and if you were called, then net to you would be 6+5 or $11. roughly 25% against net cost basis of $44 (49-5) for a six month investment. Even better since you get $5 of the $11, now. Not too bad considering the times. Not as good for you as it might have been if TXN were to rise significantly above $55 by July. But you should do the math & decide what's right for you. Remember. In the last year, TXN has traded for as little as $31 and as high as $71.