--- In FairfieldLife@yahoogroups.com, "shempmcgurk" <[EMAIL PROTECTED]> wrote: > > Listen up, class. > > Our source material can be found at the following link which will > tell us what Google options are selling at (call options are listed > first; put options later...so you must scroll down): > > http://finance.yahoo.com/q/op?s=GOOG&m=2006-04 > > At the close of trading on Friday, Google was selling for exactly > $390.00 a stock. > > A put option means you have the right to sell google stock at > whatever the strike price is. > > Each option contract is for 100 stocks, I believe. > > An April '06 Google put option with a strike price of 310.00 sells > for 1.05. So if you bought one contract it would cost you $105.00 > plus commissions (Scottrade charges about $7.00 a contract...so, in > total, your purchase of the put option contract would be about > $112.00). > > The April '06 contract lasts until April 21st. > > Lets say Google goes down to $290.00 a stock by April 21st (after > that date, if you haven't reached your strike price, your contract > is worthless). That would be a profit of $20.00 a stock because you > have the "right" to sell Google for $310.00 a stock until the > expiration date...and you have the right to sell 100 of 'em. > > So 100 X $20.00 = a profit of $2,000.00 for your $112.00 investment. >
I believe if it seems rather likely that Google'll go remarkably down, the options shall be clearly more expensive. At least that would be the case with European put options. And the other way round with call options. ------------------------ Yahoo! Groups Sponsor --------------------~--> Join modern day disciples reach the disfigured and poor with hope and healing http://us.click.yahoo.com/lMct6A/Vp3LAA/i1hLAA/UlWolB/TM --------------------------------------------------------------------~-> To subscribe, send a message to: [EMAIL PROTECTED] Or go to: http://groups.yahoo.com/group/FairfieldLife/ and click 'Join This Group!' Yahoo! Groups Links <*> To visit your group on the web, go to: http://groups.yahoo.com/group/FairfieldLife/ <*> To unsubscribe from this group, send an email to: [EMAIL PROTECTED] <*> Your use of Yahoo! Groups is subject to: http://docs.yahoo.com/info/terms/
