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Technology Stocks : 3DFX -- Ignore unavailable to you. Want to Upgrade?

To: JR who wrote (4652)	6/24/1998 4:14:00 AM
From: Jay Fisk	Read Replies (4) \| Respond to of 16960

<<, It looks to me like the smart money started to move today, Not ready to take a stand just yet but looking.>> Agree in principle - The put/call ratio favored calls again, but the big play today was the 250 July 25 puts sold today for nearly $8. Let's look at the logic. Seller is agreeing to purchase 25,000 shares of TDFX at $25 mid-July, receiving premium of $200,000 now. If the stock is above $25 on Friday July 18 (two days after 2Q earnings), he's committed to purchase, but his net cost is really in the neighborhood of $17/share. (25 less the 8 received) On the other hand, if the stock closes less than strike price of $25, buyer gets to keep the $8 premium, no commit to purchase. Looks like smart money to me ! (hope I got those scenarios right)