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Technology Stocks : WCOM -- Ignore unavailable to you. Want to Upgrade?

To: Kirkster who wrote (2209)	3/7/1998 3:17:00 PM
From: Oeconomicus	Respond to of 11568

Buy MCIC and sell short WCOM (# of shares on each side based on the ratio in the deal). When the deal closes, you get WCOM shares for your MCIC which you then deliver to cover the short side. You pocket the spread, $51 - $47.50 = $3.50 right now (was much wider when the short interest was growing fast). Risk is that the deal gets killed for some reason in which case MCIC tanks and WCOM rises (short covering) and you lose big on both positions. Best returns if your broker will let you earn interest on the cash proceeds of the short sale (usually just the big boys get that). In any case, since WCOM has had so many deals going that were being paid for in stock, the short interest has been very large. For a better understanding, you could read Ivan Boesky's book "Merger Mania", but I'm not sure it's in publication anymore. Bob