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Technology Stocks : Intel Corporation (INTC)
INTC 48.80+5.0%Feb 2 3:59 PM EST

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To: hueyone who wrote (174612)5/15/2003 3:17:57 PM
From: Saturn V  Read Replies (1) of 186894
 
I do not have a WSJ subscription. Can you paste the relevant paragraphs ?

So far the only option expense I see is the eventual dilution of the shareholders . Recognizing that expense preemptively is being extra-conservative even-though the option may not be exercised ! So what am I missing ?

Some people seem to have a mystical faith in the Black-Scholes Formula as if it was a fundamental law of nature, like Newton's Laws of Motion. It is merely uses Probability Theory to guess at a price of the option. My personal experience with it is that is a good estimate of short term fluctuation, but a very poor estimator of longer term changes in stock valuation.
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