Advanced Micro Devices - Moderated (AMD) Message Board

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Technology Stocks : Advanced Micro Devices - Moderated (AMD)

AMD 223.54

-2.9%

Nov 19 3:59 PM EST

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To: Joe NYC who wrote (66332)	12/26/2001 10:54:14 PM
From: Elmer	Read Replies (1) of 275872

Basically, under your hypothesis, when Intel issues the call option to an employee, the expenses are all taken upfront. To hedge a naked call option, what you need I guess is: -Borrow money to buy the stock for the length of the contract -Buy the stock -Buy a put option to protect yourself from the newly acquired stock from tanking on you Jozef, why are you making this so complicated? It's much simpler. The question is simply this, did Intel purchase a number of shares in a given year that was roughly equal to the number of options granted? We already know that Intel purchases stock and has done so for years. The only question is how well that balances the number granted. No need to complicate matters with naked calls, hedges, borrowing money etc. This is not Intel specific. It applies to every company that repurcheses shares but I realize this is the homepage for Intel bashing. EP

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