Amazon.com, Inc. (AMZN) Message Board

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Amazon.com, Inc. (AMZN)

AMZN 229.60

+1.5%

Nov 25 3:59 PM EST

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

To: Oeconomicus who wrote (12069)	7/30/1998 12:02:00 AM
From: Tim McCormick	Read Replies (1) of 164684

R. D. I've studied this for many years. The only reliable use of P/C ratios is when option volume of the four nearby strike series is at least equiv. to 1/3 avg. daily stock vol. Very few stocks trade this much option volume. It works well when call speculation on a widely rumored takeover gets out of hand. In fact, even P/C ratios on the indices appear to be less relevant than years ago. The volume is just not there. You also have to be careful how you measure it-after an extended up move, the out of the money put series are so plentiful that contract volume alone is meaningless. You have to calculate the dollar weighted volume values. Also, it is important to remember, the friday before the '87 crash P/C was screaming buy. I think what happens is a point is reached where the Delta hedge panic overrides all contrarianist sentiment strategy. Anyway, even after implementing volume constraints you have to use a 5 day MA to smooth out distortions and not be too early. Tim

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next