Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: Thai C. Nguyen who wrote (692)	2/14/1998 3:13:00 PM
From: ----------	Read Replies (1) \| Respond to of 2241

Maybe not stupid. It depends on your objective. I bought DELL last week & sold a February call, fully expecting it to be called away. Why? The stock was at 110, the Feb 110 call was $4.00 , there are 10 days left on the Feb options. So, 4/110 =.036%. I can make 3.6% on my money in 10 days. 3.6 36.5 =132 (36.5 is the number of 10 day periods in a year.) So, I'm making an ANNUALIZED rate of 132% on my money for the next 10 days, with downside protection on DELL to 106 (110-4). Now, if Dell goes to 120, I could have made more just buying the stock. But that was not my objective. I wanted better than money market interest for a short period of time. Naturally, if DELL closes UNDER 106, then I will be here telling you how stupid I* was. <g> Regards, Doug