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.
Technology Stocks : Altaba Inc. (formerly Yahoo)
AABA 19.630.0%Nov 6 4:00 PM EST
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: Typhoon who wrote (22584)7/8/1999 12:42:00 AM
From: Mark Pritikin  Read Replies (2) of 27307
 
<<I shorted 5 yhoo july 180 calls for 5 3/4 naked>> I was doing this last year and was successful about 6 times in a row until I watched AMZN go from 130 to 220 in about 5 days after first announcing adding gifts in time for X-mas and then a 3 for 1 split.

Be careful--This is not a good strategy! Keep this story in mind next time you consider naked calls on Internet stocks:

I had sold 20 AMZN calls with a 150 ex. price when the stock was around 125 and covered somewhere around 158+ for a loss of about 20K. After covering, the price immediately soared to over 220 in a classic short squeeze. The DAY BEFORE option expiration the company announces a 3 for 1 stock split. They do this knowing that the current stock price was higher that ALL outstanding call option strikes. This meant that anyone that was short calls had to cover or buy the stock back buy back because there was no more stock to short. I know this because I called Fidelity to see what my options were--when I was told there was no stock to short and that if did not cover the option it would result in a market order to buy on Monday, I immediately covered on Thursday. The stock went up something like 40 Friday and another 40 on Monday. I think it hit 238 on Monday at the open.

Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2026 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News