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Technology Stocks : ZENITH ELECTRONICS

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To: rd greer who wrote (556)5/30/1996 11:35:00 PM
From: Mr. Aloha   of 578
 
I don't consider myself very knowledgeable with options...

but I can tell where people perceive the stock to go.

Very quickly -

In the paper, find where the volume is (calls are positive movement) (puts are negative, like shorting). The premium price is the cost to buy 100 shares of that stock and is determined by the amount of time before expiration and current price of the stock.

If you see more volume than usual for calls, the public perceives that the stock is going higher and they buy a contract (100 shares) for the premium price x 100(shares). IF the stock moves higher, their contract is worth more (x 100). The contract expires on the 3rd Friday of each month of that contract.

Aloha
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