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Strategies & Market Trends : Tech Stock Options

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To: ViperChick Secret Agent 006.9 who wrote (45954)6/15/1998 10:25:00 PM
From: Dwight E. Karlsen  Read Replies (2) of 58727
 
lisa, if someone sold Bay stock today, then they did get some benefit from the announced merger with NT. Since Bay didn't get close today to the $38.21 value of Friday's NT price (at .6 exchange rate), I have to assume that NT stock dropped today. From here on, NT and Bay will trade in tandem, or close to the .6 exchange ratio. There will be up to 1-1/2 points at times difference between what Bay "should" trade at based on the .6 ratio of NT, but that is due to arbitrage. The doubt factor, or some such.
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