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To: Elmer Phud who wrote (178236)5/31/2004 12:34:13 PM
From: GVTucker  Read Replies (2) | Respond to of 186894
 
elmerp, RE: So now you're claiming that BS is a good predictor?

No, at least not any more. Early on in public options trading, there were many instances where the market value of the option did not agree with the Black Scholes value. Trading companies such as CRT and O'Connor that would risk arb that difference made a whole lot of money in those early times.

It didn't take too long for that inefficiency to correct itself.