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Strategies & Market Trends : From the Trading Desk -- Ignore unavailable to you. Want to Upgrade?

To: xstuckey who wrote (2353)	1/20/1998 1:22:00 AM
From: Robert Graham	Respond to of 4969

From a Cramer article on the.street?? Bob Graham

To: xstuckey who wrote (2353)	1/20/1998 9:25:00 AM
From: Steven Bowen	Read Replies (1) \| Respond to of 4969

X, I'm not following your logic here: "Using Intel as an example last Friday, if the price was above 75 (the nearest strike price with heavy open option interest) and you owned the 75,(or below) call options, you would have a "free" short sale in that you could cover the short by calling the stock if the position ran against you. This, of course, drives the price towards the strike ptice." If you were long the calls, why would you want to short the stock? It's not really a "free" short in that you're giving up any future gain in your call. It seems that instead of shorting, you might just as well sell your call and take your profits. Short selling the stock down would make sense like in my example if you are short covered calls. Then it would be to your advantage to short sell the stock to below your strike price so that they expire worthless. Then of course you plan on covering your short during the next week for breakeven. Maybe I missed something? Steve