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Gold/Mining/Energy : Strictly: Drilling and oil-field services

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To: Big Dog who wrote (2636)10/31/1997 4:32:00 PM
From: Lyle Abramowitz  Read Replies (2) of 95453
 
Mike,

You might try the following site:

intrepid.com

There is a good explanation of options and pricing under his "About Options" link.

Also, I am moderately knowledgable on option pricing theory and would be happy to try to answer your questions.

The actual or historical volatility of the underlying security is the piece of data that's usually missing. At one time pcquote.com provided this, but not now. One can use the implied volatility, but that is circular as I like to see if the option is at premium or discount to "fair value."

Implied volatility is appropriate to use for what ifs such as what would the option be worth at a given time and for an anticipated stock price.

Lyle
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