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Technology Stocks : Ciena (CIEN) -- Ignore unavailable to you. Want to Upgrade?

To: gbh who wrote (4214)	10/9/1998 5:05:00 PM
From: dj8000	Read Replies (1) \| Respond to of 12623

i saw one person in CNBC mentioned that cienna is a turn around candidate at this level. DJ

To: gbh who wrote (4214)	10/10/1998 10:13:00 AM
From: Schmoople	Read Replies (1) \| Respond to of 12623

Why would someone hedge a position at this level in this way? If the option is exercised (due to a run up over the next week) would not that short position be 480,000 lower? Even with the tax advantage he is still out up to 240,000 than if he just covered, no? For him to sustain a significant tax advantage on the short the price needs to be well above 15 dollars. Why hedge in this way with an option about to expire? If he keeps hedging like this every week by the end of the year he may well have pissed away over 100 grand in addition to the loss from the short position that could have been covered at a lower level. Besides, why hedge to such an extent unless one is concerned about significant upward movement? I would appreciate your response as I admit I am very naive regarding this option stuff.