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Technology Stocks : COM21 (CMTO) -- Ignore unavailable to you. Want to Upgrade?

To: pat mudge who wrote (1995)	3/22/2000 11:57:00 PM
From: Wyätt Gwyön	Read Replies (1) \| Respond to of 2347

at 65 in after-hours I was hoping my naked April 65 puts would have a chance to die a natural death next month <g>. What is interesting is that CMTO had after-hours volume of 55,898 on Island. Compare that to the 16,000-share volume of that thinly traded issue known as MSFT. Remember, there's more than one way to short a stock. You can effectively short a stock by buying puts and/or selling naked calls. Going back to the time point at which CMTO was having its runup in the wake of the Gilder-induced TERN buzz, the option column at theStreet.com took note of a big seller of March calls (from Feb 28): Score one big win for the call buyers. This time it was in Com21 (CMTO:Nasdaq - news - boards), a high-speed Internet access equipment supplier, which was up 6 9/16 to 70 by midday. That action allowed an investor to sell 3600 contracts of the deep-in-the-money March 30 calls for 40 1/2, or $4050 each. The price of the calls had jumped almost 26 ($2600) from when they had last traded. Com21, which was trading at around 10 in September, has been on a white-hot tear recently, hitting a new high of 78 1/2 today, as it prepares to launch a new product that will allow users to send voice and data more quickly over cable lines. Now 3600 contracts of March 30 calls means that the writer carries risk of $360,000 for each point above 30. If those contracts were held till expiry, the writer would've been called at Friday's closing price of 54.44. Payout would be 54.44 minus the 30 strike, or 24.44. But the writer took in 40.5 per contract, and so was able to keep 16.06 per contract. That is $1606 per contract, which, multiplied by 3600 contracts, equals $5,781,600. Not bad for a month's work.