Okay, we're in business.
First trade is buy 2000 SUPG @ $.252 and sell 20 calls (UQGGZ, Jul08 $2.5) at $.55.
Notice that these are already in the money by $,02, so I really only make $.53 profit instead of the $.55 the calls sell for.
I like SuperGen because they already have a product they are selling, and yet with a good result from their current European clinical trial they will gain a little market share. Conversely, a bad result is already factored into the share price. Basically, a 20% gain in two months if exercised, and downside protection to $2.00.
Started: $100,000. Bought 2000 SUPG at $2.52 = 5040 + $7 comm = 94953. Sold 20 UQGGZ (Jul08 $2.5) at $.55 = 1100 - 32 - .05 (sec 31 fee) = 1067.95, for a balance of:
Cash: $96,020.95
2000 SUPG
20 UQGGZ
Regards,
Trond
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