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

AMZN 232.37

-0.9%

Dec 3 3:59 PM EST

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To: IceShark who wrote (21091)	10/10/1998 1:32:00 PM
From: M. Frank Greiffenstein	Read Replies (1) of 164684

They sell shares short when they sell puts, and buy them back when they close. Mirror image on calls. In other words, the option writers hedge? Selling puts naked is bascially bullish (and you hedge by shorting shares) and selling calls naked is bearish (you go long only to hedge). So the option selling is a measure of the option writers opinon of the stock? After all, option writing means you have to have an opinion of stock movement. Are there other bits of information one use the Funck chart to place options bets, or do you rely only on the put/call ratio? At first glance, it seems like you should buy puts with strike prices above the max pain and calls with strike prices below the max pain. My reasoning is as follows. If there is a "conspiracy" to drive options prcies to a point of least damage, then you can choose options that take advantage of that kind of price trend. DocStone

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