Compaq Message Board - Msg: 5463175

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Technology Stocks : Compaq

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To: SecularBull who wrote (30763)	8/11/1998 2:46:00 AM
From: Tony B	Read Replies (1) of 97611

LoD, Here is the explanation Goldman would probably give you: "While we are bullish on CPQ, we are short term bearish on the overall market in which a major correction still can not be ruled out. Therefore, we hedged our position with short-term deep-in-the-money calls against our position in stock. "If there is further pressure on the market, we feel CPQ should have good support at 30, at which point we would buy back our calls at a much lower premium. If the market stays flat or rises slightly, we will let the stock be called away and look to establish a new position in CPQ. Another option would be to roll out in time until we feel the market has stabilized sufficiently to no longer feel the need to hedge out position." While I would like to think they were just hedgeing their position, you have to wonder <ggg> Good Luck TB PS IMHO you're posts are welcome here as long as you (and others) refrain from the "my stock is better than your stock" pissing contest. There is money to be made by all, especially if we work/inform together. I look forward to your future insight.

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