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Technology Stocks : Dell Technologies Inc.

DELL 141.77

+2.0%

1:14 PM EST

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To: Chuzzlewit who wrote (110886)	3/22/1999 10:39:00 PM
From: Gabriel008	Read Replies (2) of 176387

Good evening Chuzzlewit, As I understand it DELL hedges currencies in order to minimize currency translation losses on component purchases and /or sales revenue. This is expensive insurance but mitigates against any nasty quarterly earnings surprises. On the options side I suspect that they sell puts and buy calls for essentially two reasons; 1- they, better than anyone else, know how a quarter will turn out and therefore have the odds stacked heavily on their side; and 2] they somehow have to offset the dilutive effects of the employee stock options that are execised every year. This reasoning leads me to believe that the amount of option positions they close in a particular quarter reflects their short term view of the market and its reaction to the earnings report. Suffice to say that DELL did not close out an abnormally high number of options positions in Q4 suggesting that they believed that Q1 f00 would be a positive quarter. Your thoughts would be appreciated. Regards, Gabriel

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