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Technology Stocks : Dell Technologies Inc.

DELL 132.08

-0.8%

3:59 PM EST

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To: Eddie Kim who wrote (72895)	10/19/1998 1:26:00 PM
From: Chuzzlewit	Read Replies (1) of 176387

Eddie, you guys are talking at cross purposes because you haven't narrowed the scope of your discussions. I could buy deep in the money calls (say NOV Dell 20's). Do you believe those options will expire worthless? Similarly, maybe I could buy puts for DELL NOV 90's -- do you think those will expire worthless? I don't. But there is a reasonable chance of losing money on both of those purchases. The key here is to whether there is profit made in buying out of the money calls and in the money puts? When the question is phrased that way I think you are probably right with your 95% estimate. But if the question is phrased in terms of all options, I think the CBOE number sounds about right. But given the spreads between the bid and the asked price, I'll bet that the CBOE number means that 35% of all option transactions are profitable. That makes sense because in a perfect zero sum game you would expect that the number would be 50%. I'll bet that the difference is due to the bid/ask spread. TTFN, CTC PS -- everything I wrote above is pure conjecture. I have no data to support anything in this post.

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