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To: Jan Crawley who wrote (53304)	8/31/1998 1:58:00 PM
From: djane	Respond to of 61433

TSC Options Buzz: Pricey Puts Don't Stop Tech Bears (You should be fine, Jan) By Dan Colarusso Senior Writer 8/31/98 1:21 PM ET Back in the spring, when the flowers were blooming, Amazon.com (AMZN:Nasdaq) tore its way through the stock market as speculators of every stripe bid up its shares and snapped up its options. Today, as the market continued to wilt in the August heat, Amazon was taking a beating and the call buyers were but a fond memory of seasons past. With the online bookstore down 13 to 92 at midday, traders were seeking shelter. Where? Where else these days but in richly priced put options. "There are basically more puts trading than calls in Amazon.com today. It seems like people are buying puts regardless of what the prices are," said Paul Foster of 1010WallStreet.com. "You know how it is: The first ones to wear lime-green shirts two years ago were the first to put them in the back of their closets," he cracked, likening the Internet stock sector to a fashion fad. "The mania is subsiding." Amazon isn't alone in this category, and today's weakness continued to reach stocks that aren't considered mania-driven, stalwarts such as Microsoft (MSFT:Nasdaq), Intel (INTC:Nasdaq), Dell (DELL:Nasdaq) and Cisco (CSCO:Nasdaq). The difficult part for pros has been finding the right price to buy put options, which give the buyer the right to sell shares of a stock at a certain price before the contract's expiration. Floor traders' feet were slowed by the muck of those positions, having sold puts into the downside pressure of the past month. To cover those positions, they're now being forced to buy those contracts back at high prices that they've set. Amazon's a good example of the spikes in put prices. The company's September 95 puts were trading at 11 3/4 ($1,175) today, up 7 ($700) on the day. Even so, more than 1,100 of the contracts changed hands, buying traffic that was a mix of former Amazon bulls and market-makers. Options on the tech-heavy Nasdaq 100 (NDX) were unusually busy as well. NDX index trading was heavy on the put side as the benchmark slid 58 points to 1205 by noon. The September 1190 puts, which registered volume of more than 1,000 contracts, rose 13 ($1,300) to 36 ($3,600), yet another illustration of how heavily desired the contract was. The in-the-money September 1260 and 1300 puts also posted volume of more than 1,000 contracts on the day. Also counted among today's casualties was the Morgan Stanley High Tech 35 index, which lost 36 points to hit 501 halfway through today's action. The September 500 puts traded 2,575 contracts compared with open interest of just over 2,000 and jumped 10 7/8 ($1,087.50) to 21 ($2,100). "You don't want to be buying earthquake insurance when the ground is shaking," said one upstairs options trader in New York. See Also OPTIONS BUZZ ARCHIVE