Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Dell Technologies Inc. -- Ignore unavailable to you. Want to Upgrade?

To: Eddie Kim who wrote (72641)	10/16/1998 3:32:00 PM
From: Chuzzlewit	Read Replies (1) \| Respond to of 176387

Eddie, the point is that price movements on optionable stocks need not be artificially manipulated by market makers to some max pain point. The other point is that people frequently make the assertion that the price can be manipulated so that market makers make money. I don't see how that is possible, and I challenged those who believe that it is to show me mathematically how. What bold assumptions did I make? I simply pointed out that if the price of Dell is $58 today, then a hypothetical best guess is that Dell will be around $60 a month from now based on a growth model (let's not argue about the derivation of $60). It would not be surprising for the stock to be trading in the range of $55 - $65. So, people buying out of the money Dell calls will find their options worthless or given the erosion of the time value of the premium, the value of the position has been negative; and people buying in the money calls will find that the time value of the premium has eroded to the point where they will have lost money. TTFN, CTC