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

To: Kenneth M. Koff, CPCU who wrote (55030)	7/29/1998 7:44:00 PM
From: PAL	Respond to of 176387

Yup, I am limiting my growth potential above 120 come August 21st. However, the market is so uncertain at this juncture, a 15% return in 3 weeks is nothing to sneeze at. Right now take the money whenever you can. Right now I am also short of August 110 at 8 1/2. That will be additional money in the bank. Let us just say Dell is at 130 come third Friday in August. In essence I am selling Dell at 124 ($120 plus $ 4 premium) plus that 8 1/2 put premium, so that I am ahead to the tune of 132 1/2. On the negative side. Suppose Dell closed at 110 upon expiration. I am assigned Dell at 110. My cost basis? 110 - 8 1/2 - 4 = $ 97 1/2/share, which I would be more than willing to fork money on that. Conclusion: I will limit my profit potential if Dell goes over 132 1/2 three weeks from now. Nevertheless, if that happens Dell would be appreciating more than 22% in 3 weeks and there would be some adjustment that will let me back in below that price. Any opinion to the above strategy is appreciated (Please include facts and figures). Good Luck to All. Paul.