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Technology Stocks : Nam Tai Elec. (NTAI)

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To: DanD who wrote (1290)3/29/1998 6:50:00 PM
From: Allen Furlan  Read Replies (1) of 1696
 
The market is now evaluating the June 20 and Sept 20 options at a volatility(1 sigma std dev) at .035 per week. Agree with you that stock has been much more volatile than that over past year but I believe options are appropriately priced at .035. At the lower level of volatility an uncapped long term option would be valued at 4.39. However when I reviewed(prior post) the action of Deswell when warrrants passed thru the callabilty benchmarks the premium completely collapsed and warrants were priced even lower than an in the money option. Bottom line is that warrants are worth much less than 6.
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