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Technology Stocks : Amazon.com, Inc. (AMZN)
AMZN 229.55+0.2%Dec 5 9:30 AM EST

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To: M. Frank Greiffenstein who wrote (21088)10/10/1998 1:09:00 PM
From: IceShark  Read Replies (2) of 164684
 
Doc, The forbidden word is the settlement price that would yield the least payout by options sellers (smart and big money in theory).

R is just the ratio. Do it in your head or take out a calculator. Lets you know which way the wind is blowing, and this is a contrary indicator in most minds. If everyone and their cousin are buying puts, the stock may very well rocket up.

One difference this time around, there is substantial bad news for this POS, as in the Bertie news. So expect great movement next week. You should also bone up on what some option writers do when they sell and close. They sell shares short when they sell puts, and buy them back when they close. Mirror image on calls.

Regards, IS
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