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NEW ADDITION RECOMMENDATIONS - Option Writer 9-26-06

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We are recommending the following two put writes for our OCTOBER recommendation list

We are recommending put writes on the following issues:

SMSC - Standard Microsystems Corporation is a worldwide supplier of metal-oxide-semiconductor/very-large-scale-integrated circuits for the personal computer and related industries. Their integrated circuits are developed and sold for applications in PC input/output, PC connectivity, Local Area Networking, PC systems logic, and embedded networking.

BEBE - Bebe Stores designs, develops and produces a distinctive line of contemporary women's apparel and accessories. They market their products under the bebe, bebe moda and bbsp brand names through their retail stores located in Canada and the United Kingdom.

We are recommending the following specific put writes

SMSC 28.92
SELL OPEN OCT 25 PUT = SMQ-VE
Target Price $35.00
Potential Profit (10 x = $350.00

Initial Margin $6,134 10 (contracts)
Return on Investment 5.71%
Cost Basis in Stock = $24.65
Days to Expiration = 25
Stock goes on Watch List Price at: $27.00
STOP EXIT STRATEGY
Close option position if Stock CLOSES less than $25.00


BEBE $24.17
SELL OPEN OCT 22.50 PUT = KUO-VX
Target Price $40.00
Potential Profit (10 x = $400.00

Initial Margin $5,234 10 (contracts)
Return on Investment 7.64%
Cost Basis in Stock = $22.10
Days to Expiration = 25
Stock goes on Watch List Price at: $23.50
STOP EXIT STRATEGY
Close option position if Stock CLOSES less than $22.50

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