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Strategies & Market Trends : Waiting for the big Kahuna

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To: James F. Hopkins who wrote (14997)3/14/1998 3:37:00 PM
From: Bilow  Read Replies (2) of 94695
 
Hi James F. Hopkins; Regarding the short interest and
how it changes as the stock price changes...

My guess is that a lot of the short interest consists of
people who are hedging for tax or restricted stock reasons.
A lot of it could also be hedging by market makers in the
options market.

So some of the short interest is insiders selling low,
rather than shorts selling low.

AMZN is a good case for this. You can examine the options
positions and based on the spreads be certain that there are
some big players longs out there that have boxed their profits.
Naturally the option market makers have to hedge that, so they
are the ones holding the short interest.

-- Carl
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