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Strategies & Market Trends : Classic TA Workplace -- Ignore unavailable to you. Want to Upgrade?

To: Sully- who wrote (36520)	4/19/2002 11:17:22 AM
From: Jack of All Trades	Respond to of 209892

Selling puts requires the MM to square their purchase of the put, they can do this by buying the underlying issue, thus causing the stock to be supported. DELL used to do this when they had bad news. Dell would sell naked puts. Shorts shorting the stock on bad news would sell naked stock. The options MM support the stock with the buying to cover the purchase of the naked puts. Then shorts get hosed when the stock doesn't drop... Stock goes up on short covering, puts expire worthless, DELL would keep the $$...