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To: Knighty Tin who wrote (33315)	5/13/1998 6:05:00 PM
From: yard_man	Read Replies (1) \| Respond to of 53903

Thanks for the detailed post. Surprised that you have so many strikes. With your 90/10 approach -- you must have a lot of $$'s to spend pursuing this one -- are you 2/3 or a full position on this one?

To: Knighty Tin who wrote (33315)	5/13/1998 11:36:00 PM
From: DavidG	Read Replies (1) \| Respond to of 53903

Mike, first of all, part of my posting was a typo and should have read 60, not 69. No problem, we all make Freudian Slips now and then.<g> Anyway I was checking out the latest prices of the MU puts and I am trying to determine how the PUTS long term can fair from one strike price to another. See prices below: cboe.pcquote.com Now JUNE 25's(MURE) cost me 5/8 and June 30's(MURF) are 2 3/8. The 25's require MU to drop 5 1/8 in 6 weeks before I break even...so...I think if it moves this far this fast than it is possible it can overshoot and go even lower and a 4 bagger is also possible. But Mike, I don't think this is very probable and worth the risk so I think I'll pass. With the 30's at least this will be in the money so I am interested. MU only has to drop 1 7/8 pts to break even. This is a play I would usually make in my IRA when I feel MU has reached an overbought point on the Stochastics chart. A 4-bagger though would require a 10 point drive to about 17 1/2 and don't believe this has too much probability for the risk. But otherwise I think we are playing the same game. As far as the October PUTs and Jan Leaps, I will review tomorrow, but on the surface seem more difficult for the homerun plays b/c they get significantly more expensive unless you go to the out-of-money options... but then the probability of getting a hit drops off very fast. If I am missing something please stop me so I can get back on track. One other thing. With a short position and the proper stops there is no premium, you collect gains immediately when MU drops. Now you can't get a 4-bagger, but then again you do get base hits and you only need 4 to equal a homerun.<vbg> TIA DavidG

To: Knighty Tin who wrote (33315)	5/15/1998 5:50:00 PM
From: DavidG	Read Replies (1) \| Respond to of 53903

Mike, Ok we had a big drop today and I thought we could review the PUT situation. We were discussing MURE and MURF and I chose the MURF. Now I could have bought the MURE at 5/8 and the MURF at 2 3/8. The current prices are on the ask 1 7/16 and 4 3/8 respectively. Now on the surface it looks like I made more money dollarwise with the MURF's (2) vs (13/16) but on a percentage basis the MURE's made 123% to 84% for MURF...which is expected. Also if I invested the same amount of money instead of the same number of contracts than a $5000 investment would have yielded $6150 for MURE's vs a profit of $4200 MURF. So you did much better with MURE's. Now my question is does it always have this discrepancy or are the quotes I had off for that evening since that sometimes happens with CBOE. Also the risk of Out of money puts is higher since they expire worthless more often. MY real interest for PUTs 2 months or more out do I always show this discrepancy b/c maybe it is better to trade out-of-money PUTs than in-money? TIA DavidG