Mike,
I guess to know the actual parity we would have to look closer at the transactions. CPQ has a very liquid options market, many trade a day. Normally in thinly traded stocks when you buy a call, the MM purchases the underlying shares, and charges you the premium. Then they hold the shares until you exercise, or sell the contract back. In both instances (thinly traded issues) you will lose the spread.
In CPQ (heavily traded) you never know if the options you are buying or selling are coming from individual investors, or market makers. It could be that a bunch of holders sold covered calls over the last few months, and are now repurchasing the calls.
In spite of all that talk, I do not think the MM can manipulate (at least very much) the options market. The underlying shares represented are material, but have already been accounted for. The MM are seriously risk averse, why would they take on the exposure.
Regards,
Kman |
