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Technology Stocks : Intel Corporation (INTC)
INTC 35.53-1.1%Nov 14 9:30 AM EST

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To: TTOSBT who wrote (51410)3/27/1998 8:41:00 AM
From: Mary Cluney  Read Replies (1) of 186894
 
TTOSBT, Selling Puts in a Buyback strategy to put floor on share prices.

Staff Reporter Dan Colarusso, in TSC (the street.com), describes how MSFT sells Puts setting up a Buyback scenario.

This is how it works as described in TSC:

Selling puts accomplishes two goals for Microsoft. The firm gets to take in premium from the broker and if the options expire worthless, it can walk away happy. If, Microsoft's shares slump the company is forced to repurchase shares via the put sales effectively triggering a stock buyback and providing support for the stock.

Sounds like a no brainer to me. If you have the cash hoard that MSFT and INTC has - the rich can get richer fairly easily.

Mary
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