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Technology Stocks : How high will Microsoft fly? -- Ignore unavailable to you. Want to Upgrade?

To: t2 who wrote (14433)	1/17/1999 12:24:00 PM
From: ed	Respond to of 74651

Most of the time stocks like MSFT move either in the first 30 minutes of the opening or within the last 30 minutes before closing, so you only need to hold the options for less than 30 minutes so that you won't run the risk of losing too much time premium .

To: t2 who wrote (14433)	1/18/1999 9:49:00 AM
From: PMS Witch	Respond to of 74651

"What would you expect to get ..." This spread should cost about $2-3 to put in place. Assuming the stock spikes up in anticipation of earnings, you'd be able to close your spread with a profit of about $2, a double. If this much faith is placed in the earnings report, which Friday's $8 rise gives evidence exists, disappointment with the actual numbers will follow, bringing the stock down Wednesday. As the stock price falls, even more people will sell too, overdoing the downside. You may expect to make $4-5 here. Total it up: Spend $3, get $5, spend this $5, get $9. A triple. Happy trading, PW. P.S. Another question you must address: What if things don't go as planned? If this happens: You may lose your $2-3 initial investment; keep the spread and hope for the best before they expire; or worse, see the profit from the spread disappear with the puts as the stock keeps climbing. I hate making round trips.