Jabil Circuit (JBL) Message Board

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Technology Stocks : Jabil Circuit (JBL)

JBL 229.93

+0.8%

Dec 10 3:59 PM EST

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To: jeffbas who wrote (4129)	6/17/1998 12:33:00 AM
From: Chuck Williams	of 6317

It depends if people bought puts to protect their long position, bought them without having an existing position, sold them naked, or sold them naked and shorted JBL as a hedge -- i.e., it's impossible to tell. Based upon the ticker though it appears as people were buying puts and the option specialists were shorting the stock to cover the naked puts they sold (reduces their risk). It sounds terribly confusing but really isn't. For each buyer there is a seller and the option specialists wouldn't sell that many puts without reducing their risk by shorting the stock. Of course the put buyers are hoping JBL will fall and the put sellers are hoping JBL will rise or stay the same (if they sold at the money puts). If they sold in the money puts and JBL rises they'll cover their shorts and we'll see a MAGNIFICENT short squeeze (and they'll make money from the put premiums) and the put buyers will be up shit's creek without a paddle! We'll certainly see a lot of option activity tomorrow. Did I thoroughly confuse you?? I think I confused myself :-) disclaimer: it's late and this diatribe has not been regression tested.

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