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Strategies & Market Trends : Options 201: Beyond Obi-Wan-Kenobe -- Ignore unavailable to you. Want to Upgrade?


To: Tim O. who wrote (730)2/13/2003 12:45:37 AM
From: Dan Duchardt  Respond to of 1064
 
It's hard to tell what somebody is doing with these things. Looks like a big chunck of the OI came from a day in mid-December at about $1.

host.wallstreetcity.com

That hardly seems like a desirable long position, so I'm guessing you are right on the short. I own a small lot of AMKR and a few long LEAPS calls. I think it will do better than most semi companies if the industry starts to recover, so selling those puts for $1 looks pretty safe to me. Who knows.. maybe somebody else sees it going to zero by then, or at least expects another big dip soon.



To: Tim O. who wrote (730)2/19/2003 11:26:35 AM
From: KFE  Respond to of 1064
 
Tim O,

I noticed an extremely high OI on a stock that i'm heavily invested in

This situation is not that unusual and there could be several reasons why someone took a large position. The most likely reason is usually a hedge or arb but could just be a speculation at these prices. I don't know the company but many companies also use selling puts as part of a share buy back program to decrease the cost.

Regards,

Ken