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Pastimes : The Naked Truth - Big Kahuna a Myth -- Ignore unavailable to you. Want to Upgrade?

To: MythMan who wrote (49059)	6/23/1999 3:49:00 PM
From: Lucretius	Respond to of 86076

ever since ii had those Junes expire... yes -g-

To: MythMan who wrote (49059)	6/23/1999 4:08:00 PM
From: John Pitera	Respond to of 86076

Myth, I agree with the non-dairy on short interest figures, some desks and firms can have huge OTC options on a stock that invalidates the Short interest ratios. ------------------ Little Interest in Short Interest By James J. Cramer 6/22/99 11:27 AM ET Every time the short-interest figures come out, I brace myself for a mountain of email about how to use these numbers to make money. So let me pre-empt the mail: You can't. That's right, these numbers cannot make you money. Been there, tried that, failed. I have attempted over the course of the last two decades to make money off these numbers in a variety of ways. I have picked the most shorted stocks and bet that maybe we could get a squeeze (a short squeeze that moves a stock higher as people cover the short). I have shorted the most heavily shorted stocks, betting that something bad will occur (all after doing homework on the fundamentals). I have tracked the stocks with small floats that are heavily shorted to see if the "days to cover" figures might spontaneously cause a rush up if anything good happens. Nothing worked. Nada. First, these numbers are hopelessly incomplete. There is so much trading that is derivative or against convertible bonds or against options or against indices that you are just spinning your wheels on this stuff to get it to work for you. You don't get to see what these shorts might be against. Arbitrage corrupts these figures. The lack of reporting requirements on derivatives, especially off-board derivatives (private trades between brokerage houses and institutions), renders them just plan irrelevant. I also find these numbers virtually useless as an indicator for where the market is going. When I first got in the business, a big short-interest figure meant that the market had to go higher because of all the stock that had to be bought to cover. Then there would be these big decreases in the number of shorts, and nothing would happen -- again because the numbers are so distorted by arbitrage. So why bother to publish them? Beats me. --------------------------------------------------------------------------------

To: MythMan who wrote (49059)	6/23/1999 4:15:00 PM
From: John Pitera	Respond to of 86076

I think Cramer is right that the theme concept of the chip stocks esp. those with a telco angle, is what's making these stocks go. Watching the Semiconductors Romp By James J. Cramer 6/22/99 2:15 PM ET Tech still has legs. It's a virtual SOX romp! And it's being done on massive volume by underinvested managers who want results and want them now. How bullish is this market? Earlier today, there was a benign -- no, make that boring -- interview with Texas Instruments (TXN:NYSE). Kind of like a business school Q&A or worse. And the stock quickly rallied 2 points! Amazing. Remember, mutual fund managers love themes, quantifiable, verifiable themes. Semiconductors that have something to do with broadband, wireless, Internet, DSL, modem -- you know, those fabulous buzzwords that stand for stock performance -- are good till the end of the quarter. In fact, any selloff at this point looks like it would be a gift. No mutual fund manager who wants to keep his job will come into this next quarter underinvested in semis. The Net? Sure, I could see them balking. Personal computer makers, yeah, pays to be careful. But a manager who isn't long the semis? That guy might not be running money in Q3. If you understand that imperative, you are on the case. --------------------------------------------------------------------------------