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

To: Lee Nelson who wrote (17276)	8/25/1998 10:24:00 PM
From: Sam Scrutchins	Read Replies (1) \| Respond to of 213182

If the stock holds below 41 on the open tomorrow, it would seem to be an ideal time to pick up some OCT 40s, with the intent of selling on a 1/2 to 2 point gain. Lee, I had intended to respond to Web several days ago about the same sort of issue, but couldn't find the time. Today, when Apple dropped to 40 5/16, I placed an order for the Sep 40's at 3, but missed it because the stock suddenly rallied, probably on the news about the new powerbooks. I picked up some on Monday at 3 5/8 with the intention of averaging down if the stock kept falling (I don't think it will go much below 40, if at all, unless we have another major tank). The premiums seemed high to me, and still do to some extent, so I am a little wary of large positions at this point unless I can get a very good price. Earlier this month, I was playing the 42.5's, both August and September, so I have changed my strategy a little to buy in the money. I'm doing this because I think most of the long runs for Apple are over with. The stock should continue up, but the movements will be more volatile and the percentage gains at any one time will probably be less. This will take more concentration and effort, as well as more trades and commissions to maximize profits. While I now hold Oct 40's for a longer run, I do not recommend them as a trading vehicle unless you intend to sell the Sept 40's (or some strike price) against them on pullbacks. If your intent is to trade, I think you should get the closest available expiration, because you pay less penalty for stock price increases. Obviously, you have greater risk on capital as well. The deeper you go into the money, the more you affect your percentage return, but also the more you get a dollar for dollar increase. Your choice. I'll stick with the September 40's at least for the rest of this week. JMHO, Sam