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Technology Stocks : America On-Line (AOL)
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To: DOUG H who wrote (17616)5/19/1999 12:52:00 PM
From: Richie  Read Replies (2) of 41369
 
DH,

Triple witching only occurs when all three forms of contracts expire on the same Friday. Equities always expire on the 3rd Friday of every month.

Quite a few people believe that the MMs and Specialists move the market in the direction to capture the most money, however, this only occurs when an external influence does not move the market (greenspan, kosovo, asia....whatever it is that week) external influences always cause greater action than the MMs and Specialists. MMs always hold PUTS and CALLs in the same underlying equities, but they "step" into these positions and different prices, ie, they may sell puts when the stock is up and calls when it is down and everywhere in between, but at any given time, they know their breakeven point, excluding the time premium. The time premium is where they make the BIG CASH.

IMO it does seem to usually settle around a strike price. I'll pick a few test cases and post them on the thread and we can analyze it for the May options.

RichieH
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