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From: suhre@trwrba.UUCP (Maurice E. Suhre)
Newsgroups: net.invest
Subject: Re: options for beginners
Message-ID: <1302@trwrba.UUCP>
Date: Wed, 27-Feb-85 19:34:01 EST
Article-I.D.: trwrba.1302
Posted: Wed Feb 27 19:34:01 1985
Date-Received: Sun, 3-Mar-85 05:43:51 EST
References: <2782@dartvax.UUCP>
Organization: TRW EDS, Redondo Beach, CA
Lines: 19

Take a sum of money and leave it in the money market.  Take 
the interest received and use it for your options investments/speculations.
That way, you won't go broke when you are wrong.

My broker says that when the news is bad, buy on the fourth
day.  I looked at Data General options then and didn't like
them.  I was probably wrong!

The main thing to remember is that an option is a wasting asset.
If you don't sell and cut your losses, they will continue to mount
until they reach 100% for an out-of-the-money option.  Stocks
usually fall and finally bottom out.  The other thing is that
buying out-of-the-money options just because they are cheap
usually results in all loss.  However, you may strike it big.
They are "long shots".

Maurice

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