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Technology Stocks : JDS Uniphase (JDSU) -- Ignore unavailable to you. Want to Upgrade?

To: djia101362 who wrote (11523)	7/19/2000 11:58:39 PM
From: Warren Gates	Read Replies (2) \| Respond to of 24042

I completely agree on the higher risk of holding SDLI vs. JDSU. Arbs will definitely start to cover as momentum shifts to JDSU and spread widens. Also the Merrill Lynch figure of 87 billion market cap, I think does not include ETEK which should be another 20 billion. ANd then there are the closet managers who try to keep pace with the S$P by buying the biggest members, which JDSU will be. And then there are the managers who already own JDSU. I'm sure, they will try to maximize their gains and hold out until the 26th before they sell to the S&P managers. JDSU has about 50% institutional holders, 30% insiders, some big foreign holders who obviously were caught by surprise so will just hold, some 5% short. I would say, it will really depend a lot on the existing institutional holders. Since JDSU is not part of any other index, they don't have to sell. And with earnings coming out, what better way to outperform these S&P managers than to hold out till the final hour, then dump it to them. A final point. Holding JDSU instead of SDLI, assuming JDSU goes to 140-150 and stays there will be the safer play, IMO. Down the road, if the merger is approve, JDSU will have another pop because of all the equivalent SDLI shares ($40 to $50 billion) the S&P funds have to buy.