[Selling Calls against my LEAPS on Micron (MU)/Selling to Open the Jan '06 12.50 Calls (MUAV)/Day Order/Limit $0.65]
Dear Member,
As you know, I currently own the Jan '07 $10 calls (VGYAB) on Micron (MU). I bought them for $3.50 and later sold and bought back the May 10 calls for a 45 cent a share loss. My basis, therefore, before commissions in the position is $3.95. I am now placing an order to sell the Jan '06 12.50 calls (MUAV) for 65 cents or better for the day. If filled, this will bring in 65 cents a share income and place me in a position where my risk is reduced to $3.30 a share from the current $3.95. If I were called out at 12.50, I would lose 80 cents a share, but, of course, it would be my intent to adjust the trade if MU broke through resistance at $12.41. The stock is currently trading around $11.45.
DISCLOSURE: At the time of publication, I own the Jan '07 10 calls on MU.
Sincerely,
Bill Kraft for
CutLoss, Inc.
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