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.

Technology Stocks : Dell Technologies Inc. -- Ignore unavailable to you. Want to Upgrade?

To: Venkie who wrote (50493)	7/9/1998 5:54:00 PM
From: Dell-icious	Read Replies (3) \| Respond to of 176387

Well at $8 for Aug 100 calls, the premium is quite steep. A better choice would be in-the money calls, such as the 85s or 90s. I am still holding onto my Aug 75, 80 and 85 calls, but I had bought them way back in April :) Dell-icious

To: Venkie who wrote (50493)	7/9/1998 6:45:00 PM
From: Rich Young	Respond to of 176387

I'm looking at 110's for $3 (assuming a brief pullback to around 95 sometime in the next few days or at least by July expiry). At a target of 120-125 by earnings (this time next month), I expect to get about a 400% return. If I thought the stock would be higher than 120-125 at earnings, I would buy the 115's or 120's for a better return. Anything beyond that doesn't look real attractive right now at any reasonable future price. If I thought the stock would only hit 110-115, I would be buying the 95's. Just my .02 - NOT ADVICE RCY

To: Venkie who wrote (50493)	7/9/1998 7:44:00 PM
From: jim kelley	Read Replies (5) \| Respond to of 176387

Venkie, I bought 200 contracts of Aug 95 C two days ago just before the runup and they have doubled. I also bought some Aug 100 calls at the same time. Since the price has moved up somewhat I would suggest some Aug 100, 105 and 110 Calls. Buy on any pullback if you can. Glutted but not sated in San Jose..........BURP!

To: Venkie who wrote (50493)	7/9/1998 11:57:00 PM
From: Don Martini	Read Replies (1) \| Respond to of 176387

Venkie, consider selling Puts vs buying Calls The August 100 Puts and Calls are both about $8.00. If you buy the Call your break even is $108. The shares must reach $116 for you to match the $8 put premium. If you sell the Put your break even is $92. You have $16 less risk. But you lose the upside potential above the $116 If a Call lets you down you lose it all. If a Put fails you ROLL IT OUT and take in more money. If you roll it out far enough you can drop the strike price, take in more premium and reduce your risk too. You can do this indefinitely! EX: sell November 130 Puts for $36.75 = $3,675 per contract. You have no investment at all. If they're put to you the net cost is $93.25, $13 better than the stock would cost buying the 8/100 Call. You get the money in your account immediately. Never spend a dime. You can sell Puts to finance Calls. EX: I sold the Jan 2000 Dell 110 Puts for $28. Bought Aug 90 Calls for $14. This left a surplus of $14 in the account, plus the calls. I expect Dell to be $130-150 at expiration. Total cash flow at $130: Calls: $40.00 [They were paid for by the put sale] Puts: $14.00 [Unspent money from original sale] I'll still be on the hook for the Puts. Can do two things: Wait it out until they drop to 0 and keep the $14. Use the $14 to close the puts which may cost less than that. If Dell reaches $150 I can close the Puts for $6-$8 in August and find another play, for more premium dollars. I close puts when 2/3 of the premium has been won, and so get to trade a lot in a hot market. Right now I'm short 80 puts, long 30 calls, like to have a 2-to-1 or better ratio as I enjoy using the other guy's money! Venkie, I've been enjoying your enthusiastic posts for a year and particularly admire your loyalty to Michael. My best to you! Don