[Opening Position in Genitope (GTOP)]
Dear Member:
Genitope (GTOP) is trading around $3.35 and $3 has been the low on the weekly for the last quarter. The stock has not been below $2.50 since mid-2006. I am placing an order to sell the Jan 2.50 naked puts (GWYMZ)at a limit of $1.30. If filled, $1.35 a share will come in to my account tomorrow. My risk is that the stock could be put to me at $2.50, but since the market has already given me $1.30 a share, ignoring the small commission, I am profitable all the way down to a stock price of $1.21. Total risk is $2.50 for which I conceivably be required to buy the stock if the price falls less the $1.30 the market pays me for the puts.
DISCLOSURE: At the time of publication, I have no position in the referenced options or the underlying stock.
Sincerely,
Bill Kraft
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