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To: Probart who wrote (8755)	5/26/1999 10:40:00 AM
From: Jenne	Respond to of 19700

Hedging Bets on the Net By James J. Cramer 5/26/99 10:29 AM ET Could there have been hidden derivative sellers of the Net recently? In the past few days, several Wall Street firms have been offering insurance to insiders anxious to lock in gains, while other firms have offered derivative products, like the one mentioned in today's editions of The Wall Street Journal, that allow you to hedge downside exposure to the Net. Having sold products like this, and had them at one time constructed for me, allow me to give you the insider view on what's going on. These products can't be sold unless they are hedged themselves, which means these institutions are shorting these stocks aggressively themselves to protect themselves from getting stung by the insurance they are offering. It's pretty simple. Whether you are a bookie or an insurance company, you have to lay off risk. It is no different if you are a brokerage house. If everybody takes you up on your insurance and the storm hits, you are wiped out as surely as if you are in the storm yourself. The Journal's story -- replete with a cheap shot at TSC unbefitting that publication -- left out entirely, for instance, how an issuer could float an Internet bond "without anxiety." It can only be done through the type of hedging I am describing. Does that mean we can rush out and buy the DOT? No, it is just important to understand where the selling is coming from and why it is coming. When the hedgers hedge, they tend to do it with the deftness of a Triceratops wandering through the Short Hills Mall. Lots of people -- and stocks -- get hurt in its path.