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Technology Stocks : TAVA Technologies (TAVA-NASDAQ) -- Ignore unavailable to you. Want to Upgrade?

To: Alastair McIntosh who wrote (27393)	2/3/1999 11:12:00 AM
From: Karl Drobnic	Read Replies (1) \| Respond to of 31646

RE option pricing: There are over 1400 open Feb. $7.50 call options, and no significant offsetting position in the puts. In fact, open interest in the puts is sparse for all strikes and months. The only options that have enough open interest to influence the share price are the Feb calls at $7.50 and $10. I don't see evidence that the specialists are selling puts to offset their exposure to the open calls. Nor is there much evidence that they are selling other calls to hedge their exposure. If they are short the calls, then are they long the stock to hedge their exposure? Or are they sitting there exposed (unlikely)? My main point is that there is a concentration of risk in the Feb calls with the 4 options specialists. These are 4 identifiable persons with a reason to move the stock price, and so their assessment of risk in the calls is worth watching.