Options Put Giants In A Jam

For years, companies made billions on investor bets that their stocks would fall. Soon, they may owe billions

In the great bull market of the 1990s, many companies thought they were printing money by selling options on their own stock. Microsoft Corp. made about $1.8 billion in the three years ended last June by selling puts to investors who bet that Microsoft's stock would decline. As the stock rose, the puts expired worthless. Over the same period, Dell Computer Corp. reaped $97.5 million selling puts on its stock. Even Adaptec Inc., a small manufacturer of computer peripherals, made about $13 million.

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