[Closing LEAPS Call Position on Harrah's (HET)]
Dear Member:
As I explained in the Weekend Summary, Harrah's (HET) has accepted an offer to be purchased at $90 a share. The stock is trading at about $82.73 and my Jan '08 80 LEAPS (WBIAP) calls are quoted at $7.20 x $7.80. I have the choice of exercising my LEAPS, buying the stock for $80 and awaiting the $90 payment some time down the road (estimates as long as 18 months). If I choose that option, I will ultimately make $3.00 a share though I will have to make a large investment by buying the stock. My other choice is to try to sell my calls. I am placing an order to sell to close the Jan '08 $80 calls (WBIAP) at a limit of $7.70. If they do not sell, I will exercise the calls and sell covered calls against the stock.
DISCLOSURE: At the time of publication, I own the Jan '08 80 calls on HET.
Sincerely,
Bill Kraft
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