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Technology Stocks : All About Sun Microsystems -- Ignore unavailable to you. Want to Upgrade?

To: Charles Tutt who wrote (38306)	11/28/2000 12:04:18 AM
From: Prognosticator	Read Replies (1) \| Respond to of 64865

If I recall correctly, derivatives are the opposite to integrals. Derivatives are easy to calculate, while integrals require some intuitive jump. Hedges are something that horses jump over. So what we have here is a whole lot of short people jumping over hedges while trying to compute calculus that requires creativity. Sounds pretty bad for the market to me. P. (P.S. I recently went short for the first time on some really overvalued stocks, not SUNW. It's scary, all that downside risk, but kind of liberating: no emotional tie in to the position, simply evaluate the company, and make your trade, put in the stop-loss and close your eyes). Still V. long SUNW, and will add more on dips. Sorry twit.

To: Charles Tutt who wrote (38306)	11/28/2000 12:17:01 AM
From: chic_hearne	Read Replies (1) \| Respond to of 64865

Charles, I would first like to say that I am no expert in this, and IMVHO no one else is either. It's all left up to interpretation and the data is intentionally old, which in my opinion, is one of the only advantages left for the brokers. Given that trading data is not handled by paper, is there any logical reason it shouldn't be available up to the second for any person? The only conclusion I can draw is that this policy favors the brokers. Much like full disclosure helped the brokers bail out before bad news was public, or go long before good news is public. That said, I'll give my best to interpret the short spoo data the way I see it. If they're short S&P, and it's a hedge, then presumably they're long something else that's related (perhaps S&P stocks). So why focus on the short side? Why not conclude they must be long huge quantities of stock because they anticipate it will rise, and are short the S&P as insurance? And if my scenario is in any way correct, are they right about the long position or the need for insurance? I agree with your analysis, but not your conclusion. It is a hedge, no doubt. Therefore, what does this mean? That is the real question in my opinion. Look at the facts, the commercials are rarely wrong. They tend to be long at bottoms. If this is a bottom, why are they not long? More importantly, why after the Naz has been cut in half are they more short than ever in history? Keep in mind, the spoo's are a big percentage tech [IMVHO, the market is the Naz until it experiances tough love]. So I agree it is insurance, as any other hedge is. But if overall they are short net this much, can any conclusions be drawn? IMHO, yes. The conclusion I draw is that they believe the market will go down, because they've bought so much "insurance". If the market goes up, what will they do? Are they going to load up on tech? Not in my opinion. The short data tells me they believe the market is overvalued and if it goes up, they will be selling stock. Another way of looking at it is that they will be selling so much stock that they believe it will drive the overall market down and the short spoo contracts will appreciate. Wouldn't this make sense when they are typically long at market bottoms? They load up on spoo contracts ahead of going long stock assuming the massive buying about to happen will drive up the spoo contracts? This is just my opinion and the way I see it. But I believe to dismiss the commercials being record net short the spoo's as blah blah blah will be reckless to your portfolio. chic