Explore Your Options  |  JUL 2005

Explore Your Options by Tom Gentile

Stocks & Commodities V. 23:7 (79): Explore Your Options by Tom Gentile Got a question about options? Tom Gentile is the chief options strategist at Optionetics (www.optionetics.com), an education and publishing firm dedicated to teaching investors how to minimize their risk while maximizing profits using options. To submit a question, post it to our website at http://Message-Boards.Traders.com. Answers will be posted there, and selected questions will appear in a future issue of S&C. LEAPS QUESTION Q: I know that there is a point in time when LEAPS turn into short-term options and change their names. Can there be any problems with renaming for me if I still hold such an option? A: Long-term Equity Anticipation Securities (LEAPS) have different symbols than do short-term options. However, as time passes and the options become short-term options, the symbol will change. The symbol change, however, will not affect the value of the options contract. It is merely a cosmetic change and your brokerage firm will make the necessary adjustments. There is nothing to worry about.

by Tom Gentile