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Strategies & Market Trends : Waiting for the big Kahuna

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To: bobby beara who wrote (34551)	11/28/1998 3:14:00 PM
From: Just_Observing	Read Replies (1) of 94695

Problems with the Put-Call Ratio All analyses based on the Put-Call Ratio assume that investors are buying the puts and the calls. The open interest does not provide info. as to whether investors are long the calls or short them. So given a situation with a 3-1 call-put ratio, it is automatically assumed that investors are long the puts and the calls. However, this scenario is only one of four possible scenarios. They are: 1. Investors long calls and long puts (usually assumed) 2. Investors long calls and short puts (even more lopsided to the bullish side) 3. Investors short calls and short puts (somewhat bearish investor sentiment) 4. Investors short calls and long puts (very bearish sentiment). I wish that when open interest figures are provided, we could find out whether market makers are short the calls or puts (as is usually assumed) or they are long puts and calls. Does anyone know how to find out whether the open interest reflects whether the market makers are short or long? I would appreciate any help in this matter. Regards

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