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Technology Stocks : Qualcomm Incorporated (QCOM) -- Ignore unavailable to you. Want to Upgrade?

To: bananawind who wrote (8347)	2/10/1998 5:24:00 PM
From: David Beckett	Respond to of 152472

Jim, <making some broker happy> Fidelity isn't losing money even with the Spartan account at $14.95/trade and options about twice that. However, the transactions cost less than 0.2% of the underlying stock, and the strategy promises? to add 2 - 3% per month to the return of the underlying equity. My strategy is to hold a portfolio with less than ten stocks which support a long term outlook, but then to use options to control risk while also adding some to performance. A strong but volatile stock works best. QCOM certainly fits that profile. When I sold the March 50 call for $3 1/2 that gave me a 7.4% cushion against further decline in value. It also limits the upside to $50 until the 3rd week of March. However, if called I will have made 22% in 3.5 months. That is OK, and if it falls through the 45 support level, support aught to be rock solid around 39, so my downside risk at this point is less than 8%. See Subject 12574 for ideas The Eagle