Reminds me of the white paper Goldman sent to their clients going on about 'Volatility as an Asset Class'. They preached that being short vol was a profitable proposition--vol spiked shortly thereafter. Good call guys!
They did get the mortgage meltdown right, though:cool:
And as DealBook has written before, Mr. Ballmer is under a lot of pressure to clinch a deal. Failure to do so would be seen as a major management blunder, and shareholders could raise questions about his leadership.
Great Link here...
Even if you're in the highest tax bracket, it makes more sense to trade SPYs. You do run the additional risk of early exercise though...American as opposed to European options and so forth.
http://www.irs.gov/pub/irs-pdf/p550.pdf
Options transactions are spread out over 80 pages but equity options are covered in detail beginning on page 56. There's a nice grid on page 57 that you can use as a guide.