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Strategies & Market Trends : Tech Stock Options

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To: rosebud who wrote (58495)	8/25/1999 2:14:00 AM
From: Herschel Rubin	Read Replies (2) of 58727

Has anyone been so fortunate as to be deeply in the money on a substantial number of call contracts and wanted to unload them without "moving the market"? If so, what is the best way to do so without moving the market? Sell slowly in small chunks of 10 contracts? Or offer large chunks of, say 250 contracts so the specialist can work the whole thing at once? It seems that the worst fill you could get would be if the options specialist backed off the bid to near the intrinsic value (number of points above the strike) when he sees your large sell order. Thus, you wouldn't profit from any volatilty premium value or time value normally accrued to your contracts. Anybody have any battle stories or first hand experience with this situation? In other words if you own, say some November 20 calls and the stock is trading at $25, are you likely to get only the intrinsic value ($25 - $20 = $5) for the calls if you try to sell a chunk of contracts? And if so, might you be better off "working the order" slowly yourself? Thanks in advance.

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