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Technology Stocks : Cisco Systems, Inc. (CSCO)
CSCO 81.16-2.4%Feb 4 3:59 PM EST
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To: GVTucker who wrote (67892)5/17/2005 2:30:28 PM
From: rkral  Read Replies (1) of 77400
 
GVTucker, re " would argue that there is more incentive for Cisco to OVERprice the options if they could, rather than underprice them. But since the people bidding for the options won't willingly pay too much for the options, odds are that they'll sell at the market-clearing price."

If the option quantities are nearly the same, I agree.

But what if the "identical" options sold to institutions were only 10% of the ESOs? The company would then be more likely to accept an underpricing IMO.

Ron
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