PLEASE DISREGARD PREVIOUS POST, THIS IS THE CORRECT POST. THANK YOU.

>>how about a hedge? Say.. buying EZQOK ERTS 55 Mar07 PUT to match the shares you hold? Then you would have any current profit greater than 0.9% 'locked in' and would not gain anymore profit until above 55.48 (+4.23%). The risk is the chance you will lose the 0.9%.

Its buying insurance to insure profit... although you could consider that 'physically selling'. The IRS does.<<

First let me say I really appreciate you and flyer giving us different thoughts and ideas to think about. The message boards can be a great place to not only "talk up/down" a stock but also to (more importantly) share knowledge. Now to my questions.

Can you please elaborate on your numbers. I don't see how you got your .9% or 4.23% based on the Put prices as of the 2/23 close that you must have been using on 2/25. I believe the 2/23 price was $2.15.

All based on 2/23 CLOSE:

So if he bought it at 50.87 he has a $2.32 profit with the stock is at 53.19.

Now he buys the ERTS 55 Mar07 PUT for a cost of $2.15

If at the option expiration he gets rid of his stock and the stock is at:

or BELOW 55 the put exercises and he sells for 55 so he made (55-50.87 =4.13) - 2.15 =$1.98 which is less than the $2.32 he had in the first place. I come up with a 'locked in' profit of 1.98/50.87 which is 3.9% not .9% (can you please explain your .9% figure?). Also, I get a 'lost' profit that is .34/2.32 = 14.7% less of a profit than he had previously. and a 2.15/4.13 = 52.1% less of a profit if the stock is at 55 at expiration. Either way it cuts into his potential profit by approximately 15%-52%. Do I have these numbers correct?

By my calculations, at the 55.48 price you mentioned he would have 55.48 � 50.89 = 4.59 � 2.15 = 2.44 which is above his original profit not just the point he has to get to in order to �start� having a greater profit. My calculations come up with him making �more� than his original profit as soon as the stock is above $55.34 which is 4.04% above the price when the option was sold not the 55.48 / 4.23% you referenced. Can you explain where I got it wrong?

As to the IRS, don�t you just use the expiration date as your sale date and add the put cost to your basis. Since you seem to trade them a lot could you give a simple 1-2 sentence description of the correct handling if I am wrong about adding to the basis? Thanks