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Non-Tech : Any info about Iomega (IOM)?
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To: Gary Wisdom who wrote (36742)11/21/1997 2:40:00 AM
From: Joon Song  Read Replies (1) of 58324
 
I'd like to revisit the subject of the November call options again.

Given the strong appreciation in Iomega's stock price we now have
virtually all of the CALL options IN THE MONEY. In fact the open
interest on all the November call options adds up to 39,721 contracts
or the equivalent of almost 4 million shares. Now, one way or another
these contracts are going to have to be squared away tomorrow. The
call writers must either 1. already own shares to cover the calls; 2.
buy shares to cover the calls; or 3. buy back the contracts. The
first possibility will have no effect, but both of the later two
possibilities should cause upward pressure on IOM share price. How
much upward pressure? That's hard to say. It depends on how many
shares are already owned by the call writers, and also on how many
contracts are actually exercised instead of simply sold back to the
call writers. But given that 4 MILLION shares are needed to cover all
the calls, I would say the call writers have some buying to do.

The above paragraph seems reasonable to me, but then I suppose there
are other possibilities. Anyone care to comment on this?

Joon

From the CBOE as of 11/20/97 4PM EST
IOM CALLS:
strike Open Interest
NOV 12.5 (.IOMKV ) 934
NOV 15 (.IOMKC ) 2067
NOV 17.5 (.IOMKW ) 1246
NOV 20 (.IOMKD ) 3608
NOV 22.5 (.IOMKX ) 2239
NOV 25 (.IOMKE ) 11612
NOV 30 (.IOMKF ) 18015
NOV 35 (.IOMKG ) 3661
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