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I was long DEC stock and sold out and bought DEC puts about a week and a half
before the drop. On the say so of someone I saw on Wall Street Week or
Nightly Business Report or somesuch. I remembered it was someone I respected,
but can't remember who specifically. Was mostly cash in my Fidelity IRA and
couldn't get through for 2 days afterwards trying to buy. My trading account
was with Dean Witter, who couldn't give me an accurate quote because the tape
was so far behind. Sold the puts too early for about a 20 or 25 point gain
each.
In a message dated 6/12/99 1:43:33 PM Pacific Daylight Time,
jsnowden@xxxxxxxx writes:
> I was a broker in 87 and advised my clients to get out or lighten up in
> Sept. It never occurred to me to buy puts or go short. I was either
> stupid or too busy trying to get clients out. Then again I only
> expected a big correction.
>
> I find it very interesting that the signs were there, as I well
> remember, and traders missed the move or were on the wrong side. What
> fooled them. I remember a 100 point decline on Friday and coming in on
> Monday only to find my largest trading account talking to the branch
> manager ordering 1,000 of this and 1,000 of that. The manager was a bit
> pissed that I canceled the orders before the market opened, but not for
> long.
>
> I heard about a Merrill broker that bought puts that were worth over a
> million on Monday when he closed them out. He didn't have the money to
> pay for the purchase, but knowing the rules he made Merrill pay up and
> he quit Merrill right then.
>
> So who caught this move and what got others on the wrong side???????
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