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Strategies & Market Trends : Waiting for the big Kahuna -- Ignore unavailable to you. Want to Upgrade?

To: shoreco who wrote (67359)	11/14/2003 5:43:05 PM
From: mishedlo	Read Replies (1) \| Respond to of 94695

I understand completely. Here is a practical example. A stock sits for 3 months in a range of 11-13 You buy calls on it at 12 The stock rises to $20 in three days and you do not cash out The stock falls to $10 in three more days then settles at 12 You better believe that those options, even though the price did not change are going to be worth more just on the volatility change (assuming of course there is still considerable time left on them, lets say another month) But you do NOT ever see something go from $7 to 70 on volatility ALONE. In MY example at 20 the volatility would be much higher as would the intrinsic value. M