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To: Lizzie Tudor who wrote (178211)	5/29/2004 8:06:10 AM
From: rkral	Read Replies (1) \| Respond to of 186894

Lizzie, re "is it a lack of understanding that causes black scholes to fall apart for emerging issues? " As you know, INTC is not an "emerging issue". Ron

To: Lizzie Tudor who wrote (178211)	5/29/2004 11:23:46 AM
From: GVTucker	Read Replies (2) \| Respond to of 186894

Lizzie, RE: is it a lack of understanding that causes black scholes to fall apart for emerging issues? The people that "make the market" don't seem to think it works either, otherwise we'd have options for new issues. Black Scholes doesn't fall apart for emerging issues at all. There are privately negotiated options priced by Black Scholes for emerging issues all the time. For the public options market, there are a lot of other concerns that must be addressed beyond just pricing the option.