|
PureBytes Links
Trading Reference Links
|
I probably should not bring this up again but for me I look forward to
Single Stock Futures which will be as perfect hedge as one can get.... so...
well Football time
----- Original Message -----
From: "Ira Tunik" <irat@xxxxxxxxx>
To: <realtraders@xxxxxxxxxxxxxxx>
Sent: Sunday, October 07, 2001 4:45 PM
Subject: Re: [RT] VERY HEAVY BLK activity ON MSFT
> Everyone goes on the assumption that the puts are liquid and in many
stocks they are not. Therefore the synthetic put, long call and short
> stock is the only way to go. It allows one to trade the stock, which is
liquid, and the limited risk comes with the call. I have tried to get
> out of many put positions that were impossible because of liquidity and
therefor had to go to the stock to take the profit. It is not a
> perfect world. Ira.
>
> "Dorothy K. Carter" wrote:
>
> > less risk as well.. when you are short you have unlimited risk.. when
you
> > buy a put your risk is only premium......... ----- Original
Message -----
> > From: "Jacobson, Alex" <AJacobson@xxxxxxxxxxxxxx>
> > To: <realtraders@xxxxxxxxxxxxxxx>
> > Sent: Sunday, October 07, 2001 2:11 PM
> > Subject: RE: [RT] VERY HEAVY BLK activity ON MSFT
> >
> > > The public does goes the benefit of short stock rebate when they trade
> > puts.
> > > It is imbedded in the price ... so it really makes very little sense
to
> > > short as na individual investor. Now that puts trade on almost every
> > name.
> > > I don't remember the last stats. .. but it used to be the average life
of
> > a
> > > retail short on the NYSE was a couple of days.
> > >
> > > -----Original Message-----
> > > From: Ira Tunik [mailto:irat@xxxxxxxxx]
> > > Sent: Sunday, October 07, 2001 11:43 AM
> > > To: realtraders@xxxxxxxxxxxxxxx
> > > Subject: Re: [RT] VERY HEAVY BLK activity ON MSFT
> > >
> > >
> > > It is only the public that doesn't earn interest on short stock. As a
> > > market maker I earned broker loan rate on the cash received from short
> > > stock. During high interest periods you could earn more money being
short
> > > stock then by trading. Especially after puts, because that made the
> > > reversal a relatively riskless marginless transaction. Also after
several
> > > changes back and forth, market makers only had to have cash to cover
> > > risk, not the margin amounts that the public was subject to. Many
> > brkerage
> > > firms did the same thing through their floor operations. Generate
> > > cash from short stock and loan that money to their margin account
> > customers.
> > > The buying public became your bank. Things may have changed in
> > > the past few years, but I don't think so. If there is a way to make a
> > buck
> > > at the expense of the public, the firms will figure it out.
> > >
> > > Dorothy Carter wrote:
> > >
> > > > No doubt business picks up in bad markets.... no one is saying that
the
> > > > brokerage firms don't make money from stock loans... as I stated
> > > earlier....
> > > > that's why they do it. One of the things I ask when I call for ok
to
> > > short
> > > > a stock is to see if it is busy or if very many brokers are shorting
> > > > stocks... I use it like most use a put to call ratio.. some days if
I'm
> > > not
> > > > shorting I call just to see how business is going just to see what
their
> > > > business is like so I'm aware obviously after 27yrs in the biz. I
would
> > > > still maintain that the average broker does not short and that many
that
> > > do
> > > > have only a few sophisticated clients that do. Most brokers have
gone
> > to
> > > > fee based busines vs comm.. .. I'm curious why the thought out
there
> > > would
> > > > be that the brokerage firms would not charge interest on margin
> > > acct..(that
> > > > would be like going to a bank and not expecting to be charged
interst on
> > a
> > > > loan and if fact int rates at brokerage firms are often lower than
loans
> > > > that you can get at a bank!!! so don't know that "rip off" as
suggested
> > by
> > > > Norm is accurate)..to my knowledge there is not such thing as a
"stock
> > > loan
> > > > fee" as suggested in Norm's post... you are charged margin
interest
> > > > though. anyway.. Thank God Monday is coming so we can get back to
> > market
> > > > trading ideas .. This thread is getting old..
> > > > ----- Original Message -----
> > > > From: "Infernal Elk" <infernalelk@xxxxxxxxxxxxxxxx>
> > > > To: <realtraders@xxxxxxxxxxxxxxx>
> > > > Sent: Sunday, October 07, 2001 2:47 AM
> > > > Subject: Re: [RT] VERY HEAVY BLK activity ON MSFT
> > > >
> > > > >
> > > > > >> NW: No, they are loaning the stock so they can earn the stock
loan
> > > > fees such
> > > > > >> as interest on the credit balance. This source of income often
> > > exceeds
> > > > the
> > > > > >> commission end of the biz. Given the recent deep discounts on
> > stock
> > > > > >> commissions, I am sure the stock loan fees and interest they
rip
> > off
> > > > from
> > > > > >> the public is more important than ever as a source of income.
> > > > >
> > > > > <unlurk>
> > > > >
> > > > > having worked in back offices on & off in the past, i have to say
that
> > > > > stock loan (equities) & repos ("fixed" income) can be a
*substantial*
> > > > > source of financing at relatively little risk to a large firm,
> > > > > depending on the sophisication of the software systems that enable
the
> > > > > stock loan or repo desks (stock loans are essentially equity
"repos")
> > > > > to manage the huge volumes of stock in & out of the firm's box
hourly.
> > > > >
> > > > > some of the stock loan desks i have seen rival some proprietary
> > > > > trading desks in number of personnel. and the stock loan folks
are
> > > > > just as busy, sometimes busier!!!
> > > > >
> > > > > it's not as sexy as the proprietary side, but in bad years, the
stock
> > > > > loan & repo desks subsidize the proprietary traders' bonus
pools -- no
> > > > > joke! i've seen it happen often enough at bonus time. stock loan
is
> > > > > steady money.
> > > > >
> > > > > - *lk
> > > > >
> > > > > <relurk>
> > > > >
> > > > >
> > > > >
> > > > >
> > > > > To unsubscribe from this group, send an email to:
> > > > > realtraders-unsubscribe@xxxxxxxxxxxxxxx
> > > > >
> > > > >
> > > > >
> > > > > Your use of Yahoo! Groups is subject to
> > > http://docs.yahoo.com/info/terms/
> > > > >
> > > >
> > > >
> > > > To unsubscribe from this group, send an email to:
> > > > realtraders-unsubscribe@xxxxxxxxxxxxxxx
> > > >
> > > >
> > > >
> > > > Your use of Yahoo! Groups is subject to
> > http://docs.yahoo.com/info/terms/
> > >
> > >
> > > To unsubscribe from this group, send an email to:
> > > realtraders-unsubscribe@xxxxxxxxxxxxxxx
> > >
> > >
> > >
> > > Your use of Yahoo! Groups is subject to
http://docs.yahoo.com/info/terms/
> > >
> > >
> > >
> > > To unsubscribe from this group, send an email to:
> > > realtraders-unsubscribe@xxxxxxxxxxxxxxx
> > >
> > >
> > >
> > > Your use of Yahoo! Groups is subject to
http://docs.yahoo.com/info/terms/
> > >
> >
> >
> > To unsubscribe from this group, send an email to:
> > realtraders-unsubscribe@xxxxxxxxxxxxxxx
> >
> >
> >
> > Your use of Yahoo! Groups is subject to
http://docs.yahoo.com/info/terms/
>
>
> To unsubscribe from this group, send an email to:
> realtraders-unsubscribe@xxxxxxxxxxxxxxx
>
>
>
> Your use of Yahoo! Groups is subject to http://docs.yahoo.com/info/terms/
>
------------------------ Yahoo! Groups Sponsor ---------------------~-->
Protect your servers with 128-bit SSL encryption! Grab your copy of VeriSign's FREE guide: "Securing Your Website for business" Get it Now!
http://us.click.yahoo.com/M.WTOC/m1FDAA/cosFAA/zMEolB/TM
---------------------------------------------------------------------~->
To unsubscribe from this group, send an email to:
realtraders-unsubscribe@xxxxxxxxxxxxxxx
Your use of Yahoo! Groups is subject to http://docs.yahoo.com/info/terms/
|