Biotech Values

[zipjet]

if you had just $17,000 to buy MNTA, and you expected it to go up gradually, what would you do?

That is easy - buy the stock.

Reality is more complex.

One of my friends argues that given the risk to the stock declining sharply on a Teva approval that you are better off buying twice the long term calls in the money - say buy 2 June calls at 12 rather than 100 shares of MNTA.

It gives you upside leverage and downside protection. I think he is right.

In general I prefer to sell options and take in the premium.

ij