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To: Gary Korn who wrote (4308)	9/23/1999 8:35:00 PM
From: Madharry	Respond to of 10027

you guys are pretty funny. If this is a tsunami, it isn't gonna matter if the boat is made out of wood or fiberglass.

To: Gary Korn who wrote (4308)	9/23/1999 9:02:00 PM
From: Joseph Silent	Read Replies (1) \| Respond to of 10027

Re Volatility There is basically one way to look at volatility (though there are a few ways of measuring or characterizing it). In essence you look at price as a random variable with a certain mean and variance (usually, a Normal). The larger the variance, the greater the volatility. It means that the price takes excursions further and further away from the mean. Thus, YHOO has a greater volatility than MSFT. I do not believe that direction is important in the definition, in a local temporal sense. That is, its okay for it to go very low for some time (week?) and then very high for some time. This is still volatility. I understand that a price that zips around a lot in one day is also volatile, in a more "accepted" sense. There is, supposedly, no difference between the two, other than the order in which the random prices are generated. In other words, the "slow" volatility and its faster counterpart are identical in an ideal sense, because I can "theoretically" reorder one sequence to get the other (under certain assumptions). [The confusing part is that the fast volatility, being important to short term equity and option traders, affects consecutive prices in a way that is different from how prices are effected by (traders' reactions to) the slower volatility. This is a reasonably safe assumption to make, and I suspect that it gives some grief to the term "theoretical" in the previous paragraph.] So in sum, I confess I am not absolutely sure right now, but it seems to me that there is only one volatility. Once can think of "fast" and "slow" ways of realizing it. But each way may affect trading actions differently. Hope this makes sense. Joseph :)