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<span
>Well,
normally I look for these types of price moves [look at a SOHU chart] to play overbought
and oversold situations.
<span
>So my
thought process was to buy closer options because the May puts are inexpensive due
to the recent run up in price and the premium I would take in by writing the
calls will be nice and inflated.
<span
>
<span
>In these
situations [SOHU stock price] I only go short for a week or so anyhow.<span
> So going much farther than an June
option is looking farther than my holding period.
<span
>
<font size=2 color=black
face=Tahoma>-----Original
Message-----
From: Petros Lazos
[mailto:peter_laso@xxxxxx]
Sent: Sunday, March 30, 2003 4:02
AM
To: Metastockusers@xxxxxxxxxxxxxxx
Subject: RE: [Metastockusers]
OPTION STRATEGY
<span
>
<span
>When buying options,
always buy as far as possible in month, to avoid high time decays and have the
"time border" to see if the strategy proves correct.<font
color=black>
<font size=3 color=black
face="Times New Roman"> <font
color=black>
<span
>P.<font
color=black>
<span
>-----Original
Message-----
From: uhehs@xxxxxxxx [mailto:uhehs@xxxxxxxx]
Sent: Sunday, March 30, 2003 12:21
AM
To: Metastockusers@xxxxxxxxxxxx
com
Subject: [Metastockusers] OPTION
STRATEGY
<font
size=2 color=black face=Arial>I am considering an option strategy and would like
some opinions/comments/suggestions.
<font
size=2 color=black face=Arial>
<font
size=2 color=black face=Arial>First, the stock: SOHU. I have a short trigger set at $11.60.<span
> At which point I would normally short
2,000 shares.
<font
size=2 color=black face=Arial>
<font
size=2 color=black face=Arial>
<font
size=2 color=black face=Arial>I’m thinking about buying 20 May 12.5 Put contracts,
for what would be $5,100 cash outlay [I’m using the Ask of $2.55]
<font
size=2 color=black face=Arial>I’m also thinking about writing 20 May 12.5 Call
contracts, for what would be $3,300 of income. [Assuming $1.65 asking price]
<font
size=2 color=black face=Arial>For a total outlay of only $1,800.<span
> To control 4,000 shares of stock!
<font
size=2 color=black face=Arial>
<font
size=2 color=black face=Arial>At the same time, the June contracts would be a total
cash outlay of $1,700.
<font
size=2 color=black face=Arial>
<font
size=2 color=black face=Arial>Does anyone do this type of thing already?
<font
size=2 color=black face=Arial>Any choice over which month to go with?
<font
size=2 color=black face=Arial>
<font
size=2 color=black face=Arial>Thanks for any opinions/comments/suggestions;<span
> Hope it gets everyone thinking.
<font
size=2 color=black face=Arial>
<span
>
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