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Strategies & Market Trends : Tech Stock Options

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To: Kevin who wrote (39832)	4/15/1998 6:59:00 PM
From: peter n matzke	Read Replies (1) of 58727

Here is a basic question i hope some one can answer? if holding one weighting of S&P stocks has a beta of 1 then how do you determine the beta of an option contract? several mutual funds that are in the 1.5 to 2.0 beta range are holding september spx contracts around the 500 strike. so do you get a beta of 2 by taking half the price and half the term? so a beta of 4 would be 1/4 the price and 1/4 the term? then a beta of 12 would be the following expiration month(may) at 1/12 the spx at the 1020 strike? does this make sense to anyone?

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