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Technology Stocks : MRV Communications (MRVC) opinions? -- Ignore unavailable to you. Want to Upgrade?

To: peacelover who wrote (7417)	2/28/1998 4:02:00 PM
From: JZGalt	Read Replies (1) \| Respond to of 42804

OT - selling puts. If you continue to use Gary's example of selling the $35 ASND puts. By selling the puts, you are obligating yourself to buy the stock at $35 if held to expiration. Consequently if the stock is below $35 at the expiration, you will be buying ASND at $35/share. Selling puts also has margin requirements vs. just being bought in a margin account. Talk it over with your broker to make sure you understand the margin required to sell naked puts. I'd recommend taking one of those options short courses that are given by the Options Industry Council. Nice basics and they give you the OptionsToolbox software to play with possibilities before you use real money. ---- Dave short July 30 MRVC puts

To: peacelover who wrote (7417)	2/28/1998 7:35:00 PM
From: Gary Korn	Respond to of 42804

Peacelover, 1. Please call me Gary. 2. If you were to write 10 ASDN April 35 puts (which represents 1000 shares), you would take in about $1,300 in premium. If, at expiration, ASND closed below 35, those shares would be "put" or "assigned" to you. You would own 1,000 shares. Your purchase price for the shares would be $35 (your account would be debited $35,000 and in return you would receive 1000 shares). However, you previously took in $1.3 per share premium. So your effective purchase price would be $33.70. You see, then, that writing puts is a bullish move...you are betting that the stock remains flat or goes up. For the bet, people pay you time premium (rather than you paying time premium to the MMs when you buy calls). Gary Korn