The following is the OptionBT sighting of
"Pass the Taters".
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"Pass the Taters"
Position Description  :
Position taken   :
Twelve Months out,
Vertical Bull Call Spread for Debit,
Long the 05 Jun 1100 Calls (250 cnt) and Short the 05 Jun 1200 Calls (250 cnt),
Long Calls at the money (Close May 21,2004 was 1093.59).
June 17,2005 / Settlement = 1222.68
Credit or (Debit)   :
None. (long call strike less than short call strike)
Net = max potential of +$1,385,000 if SPX settlement above 1200.
break even (if held to settlement) at SPX = 1145
All options closed in the money and settled for Cash.
NET = +$1,385,000
Comments   :   "Pass the Taters"
Now you might think "Pass the Taters" has to do with something (dare I say
it) that a New Yorker might think a person from a small town in Texas
might say. This is not the case. The
point of choosing this name is that "PTT" is not a follower of the low carb craze
or any other craze for that matter. Here is a guy who sees the glass half full
at this time and is willing to put down a million one to prove the point.
This long term $1.1M investment will only become completely fulfilled if the SPX
closes above 1200 by June of 2005. "PTT" will need 45 points up from where the
market closed on the day of this trade to break even. This shows that it is all about
perspective. The other player who covered "PTT's" bet is equally sure that the
market will go down and stay down.
"PTT" is a good example of a individualist that stays ahead of the curve and
doesn't whimp out and ( I am speculating of course ) feels the time is right to
roll the dice.
Let's hope that this demonstration of courage ( assuming he is playing with his
own money and not someone elses ) is rewarded.
In the mean time let's also hope that any BigFoot want-a-be
watching this candidate for the Hall of Fame remembers that the BFHof is an educational
venue and not a "how-to" infomercial.
Please note the con and the pro of this example:
1) "PTT" is walking a high wire without a net.
2) "PTT" expects to double his money in the next twelve months.
Doesn't seem fair, does it?
Even so "Pass the Taters" has a chance.
The high wire analogy was a good one. We don't know if "PTT" bailed early
but it was a squeeker for sure. The SPX closed only 22.68 points above what
"PTT" needed to fulfill his maximum profit. Congratulations for your courage
and maybe wisdom. Either way the money is good.
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