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Technology Stocks : MRV Communications (MRVC) opinions?
MRVC 9.975-0.1%Aug 15 5:00 PM EST

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To: Bruce L who wrote (14339)7/7/1999 10:16:00 PM
From: WebDrone  Read Replies (1) of 42804
 
Bruce- options expiration a strong second order effect, IMO.

We had been chatting about it on the IBM thread a while back. Ben A. has a great site where he maps the max pain options analysis for a group of stocks. The max pain theory says the maximum amount of money will expire worthless as is possible. This seems reasonable, and is not due to conspiracy, but market forces- IMHO. Well, most of the time, anyway.

ez-pnf.com

I think that companies that have low liquidity in options are more suceptable to unexpected behaviors near options expiration. Witness last expiration!

All things being equal, I'll bet a stock's price moves to a strike price on the 3rd Friday of the month. By Tuesday, the effect has been wiped clear.

I'm with you, this is no myth. It's a trader thing, though. If I'm holding, I just shrug it off.

Web
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