As you know, I bought the April 100 calls @ 24 to try
to hedge against my 2k shorts @100,105.
Interesting strategy. The beauty of this thread is that we
constantly can learn from each other. Thank you for sharing it.
Assuming that you have equal short shares @100,105, then your exposure is
limited to 21 1/2 per share by April expiry date i.e. if AOL closes at 102 1/2. But
you will reap huge profit should AOL become a runaway train in either direction.
The following shows how AOL stock performed the past month and a half:
DATE CLOSING PRICE OPEN HIGH LOW VOLUME
-------- ------------- -------- -------- -------- -----------
2/27/98 121 3/8 123 13/16 123 13/16 121 1/16 3,040,400
2/26/98 123 3/4 121 1/8 124 119 13/16 2,552,300
2/25/98 118 15/16 120 1/4 121 15/16 118 3,454,200
2/24/98 119 1/16 123 5/8 123 3/4 119 1/16 2,085,000
2/23/98 123 7/8 120 1/2 125 120 2,397,500
2/20/98 119 7/16 118 1/2 119 13/16 117 1/16 1,942,300
2/19/98 117 5/8 113 1/8 117 5/8 112 3/4 2,347,900
2/18/98 112 1/2 112 113 111 1/8 1,408,100
2/17/98 112 115 1/4 115 5/8 111 2,547,400
2/13/98 114 1/4 116 1/2 117 3/16 114 3,010,500
2/12/98 117 114 1/4 117 7/8 113 1/2 3,277,300
2/11/98 114 1/2 112 3/8 115 7/16 111 3,402,100
2/10/98 109 111 1/2 114 1/2 109 6,277,600
2/09/98 110 7/16 100 112 99 9/16 6,944,000
2/06/98 98 1/2 97 1/2 99 9/16 96 5/8 1,218,200
2/05/98 98 101 3/4 101 3/4 97 15/16 1,326,900
2/04/98 100 3/4 99 1/4 101 9/16 98 9/16 1,270,400
2/03/98 99 3/4 100 1/8 100 7/16 98 13/16 1,494,600
2/02/98 100 1/8 98 100 1/2 97 5/8 2,878,400
1/30/98 95 5/8 95 3/4 97 1/2 95 3/8 1,002,100
1/29/98 94 15/16 94 3/16 96 3/16 94 1,487,000
1/28/98 94 5/8 91 3/4 94 7/8 91 3/4 1,584,000
1/27/98 91 5/16 92 1/16 93 1/8 91 1/16 1,353,600
1/26/98 92 3/16 95 96 5/16 92 3/16 1,125,300
1/23/98 95 1/4 96 96 3/4 94 1/16 801,400
1/22/98 95 7/16 95 96 1/2 93 3/8 1,270,100
1/21/98 95 1/4 95 1/2 97 1/4 94 9/16 1,654,500
1/20/98 95 7/8 93 1/4 96 1/4 93 3/16 1,716,100
1/16/98 93 92 13/16 93 3/4 92 1,418,500
1/15/98 92 13/16 90 3/16 93 3/16 89 3/4 2,839,300
PAL |
