Trick or Treat?

  • October 31, 2000
  • Tony Saliba

I’ll take both! Yesterday saw mostly a garish red on the screens, while narrow stripes of
ghoulish green slithered intertwined with the bleeding techs and dot-coms. Our
options goodie grabbers found plenty of treats from both sides of the doorway.
The Cisco put buyers did well as the stock gave the market a scare for most of
the day, while the AMAT call buyers saw more than a 10% gain before the end of
the day and continued upside through today’s first hour. 

This morning, VRSN’s announcement  of increased
service gave pre-open paper a distinctive lean towards call buying. CSCO paper,
still most active, saw a leap in call buyers before the morning gong. The number
of RMBS orders tripled before the open, almost all put buyers, once INTC
reported that Rambus chips would not be used to the same degree as in the past.
CPQ call sellers showed up as the fourth largest mob in the dawn patrol.

After the first hour, call
activity dominated by an almost 5:1 margin, sellers leading 2:1.  BRCD,
JNPR & PMCS, our three increased volume entries yesterday have all bounced
from their day-before lows. Options action in the first hour saw dumping of
calls. INKT call buying led the first hour readings.

There is no question that October’s volatility still looms as a large
influence. With the current events we are being dealt and the possible change in
the administration, volatility may remain higher than normal through the inauguration.
Options volume continues to grow monthly, as more investors realize that these
swings can be harnessed to their advantage without the absolute risk of being
wrong on a stock’s direction.

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