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To: LLCF who wrote (38284)	4/15/2007 1:30:56 PM
From: marcos	Read Replies (2) \| Respond to of 78409

Things 'not generally accepted in finance' have made us all a lot of money over the years, it's rather the point to get in before they're generally accepted and get out immediately after -g- ... but yeah, you're talking about terms and not plays Still i'm with koan in re the ckg.wt, for what i would describe as insufficient 'leverage', as he does ... and unlike him i hold a bit of the common so maybe in that way it means more? ... at a third or a quarter the price of the common they'd become attractive, above that not particularly, they are a time-decayable after all ... this being based completely on squint 'n guess estimation by a logger who never went to skool, but who kind of questions the validity of any method that does not take into account the potential of the underlying project ... only reasoning i've got, just don't understand the Black-Scholes thing at all ... and apparently it values the epm.wt.a and epm.wt.b at the same price, which doesn't compute imho, and i hold mostly the B-models, still think the As are worth maybe ten to fifteen per cent more, it's only when a larger discount is on the Bs that i buy them [which has been most of the last few months, actually] - imho the higher strike outweighs the slower time-decay at this point, and while that edge will decline over the months it will do so slowly at first Warrant holders get screwed most in cheap takeouts - this we learn from the rng.to experience, eh ... nothing in the B-S formula about that ... or maybe there is? ... doesn't matter, i can't even wrap my brain around the symbols they use, lol

To: LLCF who wrote (38284)	4/15/2007 2:14:12 PM
From: SwampDogg	Respond to of 78409

<<From what I can gather, when you speak of cheap options or expensive options you really mean you think the stock is going to rocket and they have a lot of leverage. I think it's only fair to point that out to people, as that is not generally accepted in finance.>> You have summed up my thoughts better than I could

To: LLCF who wrote (38284)	4/15/2007 4:39:11 PM
From: E. Charters	Read Replies (2) \| Respond to of 78409

Well, potential value is the only way we evaluate stock buys, as no one in their right mind buys a stock if the price today is exactly what it is (or ever will be) worth. I admit you might sell it if you thot that.. All the methods of evaluation of a stock that are considered fundamental point to and try to estimate growth potential. So, yes, value versus bid price is an accepted concept to finance. It is called market discount. It is true however that Koan has not provided us with a brass instrument way of assessing that 'intangible'. But given that there is some way of assessing the likelihood of a move (past volatility, sector stability, demand of underlying product) then the improved leverage of a warrant given the possibility of that move is something to look at. Evidently Ed Thorpe thought so, and he has forgotten more math since yesterday than you and I and your dog will ever know. And no, he is not senile. Nor are we stupid. And yes, I am admitting calculation pretends to refine witchcraft.. In fact the Black-Scholes method of evaluating 'fair value of an option' is based in part on the hocus pocus that past value predicts or infers future.. otherwise why put in the volatility index ..? isn't that what the statistical experts tell us is the sort of thinking that will lead us down the garden path in Las Vegas? Having said that I still aver that waves and wave analysis tells us that randomness even in nature is only an illusion... keep your ties, they always come back in style. (Chet Atkins) So who do you like at the Hialeah in the seventh? Here is to the inefficient market and all the corners thereof. Pash me another glass of mead, I have to do an augury and exorcism for a Sprott report.. do you think John Kaiser has much of this Consolidated Gopher Guts and Gold..? they are in China you know.. Gotta go places.. EC<:-}