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Strategies & Market Trends : Telebras (TBH) & Brazil -- Ignore unavailable to you. Want to Upgrade?

To: Ted Jackson who wrote (385)11/12/1997 3:11:00 PM
From: Aaron Weiss  Read Replies (1) | Respond to of 22640
 
It would seem so, but it's even more likely that the volatility implied in the option prices would cause them to have a huge time decay element. The prices of the puts and calls would be extremely high and would decay so rapidly that you'd need a massive move in the very near future to overcome the effects of time decay.



To: Ted Jackson who wrote (385)11/12/1997 6:09:00 PM
From: Paul Merriwether  Read Replies (2) | Respond to of 22640
 
<<To All: Anybody buying puts AND calls on this? Seems like there's some money to
be made using this strategy >>
Never underestimate the black scholes model my friend. The volatility
of the stock price is implicit in the pricing of the options!
Playing straddles can be expensive!


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