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Strategies & Market Trends : VOLTAIRE'S PORCH-MODERATED

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To: freeus who wrote (4433)9/29/2000 11:39:29 AM
From: edamo   of 65232
 
lynn....do more then track the price of the option, look for increase/decrease of volatility....this is what you are paying for.......if you are buying a long call position, you want minimum volatility premium....that is why dim are more attractive then otm or dotm....just add the prem to the strike, minus the current common price....the closer you are to the current stock price, the lower the volatility and in turn the risk factor....optimum call buy is to set a position as close to parity with the common...less leverage, but more a stock replacement...
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