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Technology Stocks : Alcatel (ALA) and France -- Ignore unavailable to you. Want to Upgrade?

To: Steve Fancy who wrote (162)	10/30/1998 4:44:00 PM
From: hoyasaxa	Read Replies (1) \| Respond to of 3891

Steve, thanks. I trade options too. Prefer LEAPS or longer-dated options in volatile stocks. Often, the premiums are just too rich but if the company is fundamentally undervalued, i.e. worth more than the market price, then it could be a good play. Shorter-term options still seem too much like gambling to me -- with the house always having the upper hand. Guess that aids in explaining --or at least contributes to -- why the vast majority of call options expire worthless. With options the volatility is the gravy, but the same rule applies for them as for equities: the price you buy them at matters. Amazon is changing the world -- but is its price justified? Telebras will be worth more in the future -- but when and at what price is it economically beneficial to purchase that hypothesis? And with options, the rub is, of course, the decay of value over time.