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

To: Yakov Lurye who wrote (5954)	8/1/1998 2:03:00 PM
From: Yakov Lurye	Read Replies (1) \| Respond to of 16960

[August Options OI] I'd decided to monitor the options dynamics for TDFX. We still have 15 trading days till August expiration, so at the moment the OI numbers are of little significance, but still: Strike Calls OI Puts OI 12.5 29 0 15 603 771 17.5 1431 347 20 1031 268 22.5 412 22 25 349 5 TDFX quote 14-5/16 Options writers' optimal expiration 17.5 Avg daily volume 630,000 shares "Max pain" hypothesis claims that a trendless stock will close at the levels minimizing the option writers payouts. FWIW, current options data suggests an upwards price bias while TDFX stays below 17.5. Of course, we are too far from expiration for this bias to be meaningful, and all other caveats (including the validity of the hypothesis itself) apply. OTOH, the size of OI is fairly significant - over 3000 calls above 17.5, suggesting serious downward bias if TDFX goes above this level. Similarly, some would consider put/call ratio at 15 level as bullish. If somebody finds this info useful, I'll post an update next week.