SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Strategies & Market Trends : How To Write Covered Calls - An Ongoing Real Case Study!
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: Night Writer who wrote (11307)8/1/1999 7:22:00 PM
From: NateC  Read Replies (1) of 14162
 
What I
don't understand is the logic behind today's large option plays on CPQ. Given the
rather grim outlook for Compaq's short term future you can appreciate my curiosity
about people buying and selling 1,000 and 2,000 option positions today. I realize
all we can do is speculate on the positions. But it should make for some interesting
and perhaps educational conversation

Dave Wright sent me a neat book, in which a very experienced fulltime options investor ( a big time one)....was comparing options investing to a poker game. He was VERY wary of buying and selling like this.....because one party.....maybe the put buyer.....maybe the put seller.....MUST INEVITABLY HAVE more information than the other one. (Someone in the poker game has a better hand) If the put buyer knows something (inside maybe) negative about the company...he is going to burn the put seller.....who thinks he is making a great return because the puts he sold he THINKS are going to expire worthless. This put seller could be a uninformed MM, who might have to buy the shares at a much lower price than the sales price for which he has to sell them to the put buyer.

Point is.....someone here.....has superior information....or thinks he does....and the other has inferior information.
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2025 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News