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Strategies & Market Trends : Stock Attack II - A Complete Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Steve Lee who wrote (22243)	10/22/2001 1:07:27 AM
From: Louis V. Lambrecht	Respond to of 52237

steve - you are correct about those high notional numbers. Where I disagree is with your example of buying a put. You indeed have a maximum risk of $25, premium of the put. Whereas a short position on gold, you would have a risk of $28k (= the notional) per contract (100 oz. @ $280). I don't know which leverage JPM or the Fed have, neither do I know if their positions are market to market at every close. Further, it is common to consider the the short positions of the commercials as bearish (coz. THEY know where the market is heading) and the non-commercial positions as contrarian. Gold - Commodity Exchange Inc. Reportable Positions As Of 10/16/01 \| ---------------------------------------------------------\| Nonreportable Non-Commercial \| Commercial \| Total \| Positions -------------------------\|---------------\|---------------\|--------------- Long \| Short \|Spreading\| Long \| Short \| Long \| Short \| Long \| Short ------------------------------------------------------------------------- (Contracts Of 100 Troy Ounces) Open Interest: 126,767 Commitments 43,774 19,686 11,104 36,316 88,132 91,194 118,922 35,573 7,845 Changes From 10/09/01 (Change In Open Interest: -7,896) -10,152 -1,462 897 5,274 -7,639 -3,981 -8,204 -3,915 308 Percent Of Open Interest For Each Category Of Traders 34.5 15.5 8.8 28.6 69.5 71.9 93.8 28.1 6.2 Number Of Traders In Each Category (Total Traders: 122) 51 29 24 28 37 97 74 Reportable positions are pretty well balanced as "those who know" (commercials) are net 52K short, covered for the half by suckers (non-commercials) who are 24K long. Further, the commercials use these low gold prices to unload some positions. Everything seems under control on these COMEX positions reports. We, off course, should add the LME's CoT, and the central banks swaps. Even the total shorts 119k contracts of 100oz. only are a notional of $3.3 bil. Far from the reported $90 trillion shorts. One of these values must obviously be completely wrong. Or is it my dyslexia again?