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Technology Stocks : Broadcast.com (Acquired by Yahoo) -- Ignore unavailable to you. Want to Upgrade?

To: Sam Sara who wrote (551)	2/11/1999 3:24:00 AM
From: B. A. Marlow	Read Replies (3) \| Respond to of 1260

Let's take a crack at your questions, David V. Options will have a net positive rather than negative effect on BCST. There are many reasons for this. To oversimplify: Options allow a more "orderly" market for a stock because the stock's market makers (MMs) can hedge their trading activities by buying or writing (selling) options. The same is true for individual investors and institutions, whether long or short. While certain traders might purchase calls as a proxy for the stock, the options MMs (generally not the same MMs who handle the stock) will tend to hedge their "books" by accumulating the stock. Individual investors may add to their long positions by buying calls, also bullish for the stock. The important point is that the availability of options is, in principle, always a bullish indicator for a stock. A stock has to earn the right to initiate options by meeting certain CBOE trading requirements. That's why they aren't available for all public firms. So, the combination of recent sales by INTC and MOT (which appear substantially over), the upcoming split, and the initiation of options should greatly improve the liquidity of BCST. This new era of stability will encourage institutions and individual investors to take positions in the stock. The float is still relatively small, but the volatility will be more modest. With the end of the major lock-up period, insiders can sell shares subject to certain limits. Aside from INTC and MOT, whose investment histories have been discussed here, it is unlikely that BCST management and employees will be selling anytime soon. Mark Cuban is BCST's largest single shareholder, with over 4.6mm shares. As you see, BCST has begun to recover from what technical analysis (TA) people refer to as a "double bottom." This is a sign the stock can now build strength. The recovery may continue into the split. While I don't know whether BCST is right for you, I can tell you that many people who follow it have been adding to their positions on the recent weakness. BAM