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Strategies & Market Trends : Options for Newbies -(Help Me Obi-Wan-Kenobe) -- Ignore unavailable to you. Want to Upgrade?

To: ---------- who wrote (638)1/31/1998 12:29:00 PM
From: Esteban  Read Replies (1) | Respond to of 2241
 
Doug,

Your explanation definetly helps my understanding of the way these options are priced. The point about leverage and percent return from the buyer's viewpoint makes sense to me. This brings up another question that I'm not at all clear about.

How does one figure the percent return on investment as a seller of naked puts or calls if one is not assigned or called? What does one divide the premium by to get the percentage return?

Esteban


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