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Technology Stocks : How high will Microsoft fly? -- Ignore unavailable to you. Want to Upgrade?

To: Teflon who wrote (29008)	9/1/1999 7:04:00 PM
From: johnd	Read Replies (1) \| Respond to of 74651

I know, but how can anyone be so sure that the stock will slide from now in the next 11 biz days. That is quite a bet imo.

To: Teflon who wrote (29008)	9/1/1999 8:11:00 PM
From: Just_Observing	Read Replies (1) \| Respond to of 74651

Why sell the Sept 120 puts? If you want to short a stock, you have to get an uptick. If you feel that you are not getting an uptick, or you are too impatient to wait for one, you will buy puts. And which ones will you buy to best approximate shorting the stock? Of course, those which are deepest in the money and do not have any time value associated with them. Thus, buying deep in the money puts for the closest month is exactly the same as shorting the stock without having to wait for an uptick. Of course, the spread on a put is quite a bit higher. That's the price you pay for the privilege of not waiting for a downtick.