SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Pastimes : Clown-Free Zone... sorry, no clowns allowed -- Ignore unavailable to you. Want to Upgrade?


To: KeepItSimple who wrote (181135)7/18/2002 2:30:20 PM
From: Box-By-The-Riviera™  Respond to of 436258
 
you are instrinsically screwed then i would say

options swings this week have been amazingly enormous IMO

but i'm no maven.



To: KeepItSimple who wrote (181135)7/18/2002 11:53:02 PM
From: mishedlo  Respond to of 436258
 
My CSCO july puts are trading BELOW intrinsic value??
Stock is at 14.41 and the july 15 puts are trading for 45 cents..

WTF??
Couldn't someone explot the spread and make a fortune?


Is that the bid or the ask?
If indeed that is the ask then yes (if you were quick enough) but it would be impossible for you to do so.

There are arbitage programs that look for discrepancies like these but execution has to be instanteneous.

1) assignment
2) sell or buy of the stock immediately to lock in the profit

Not practical for an individual to buy options and attempt to do this because buying the options in mass would affect the price.
On options already existing I am sure situations like these occasionally cause early assignment one way or other. In some cases the end result even benefits the assignee (as the stock later moves in their favor).

M