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To: Oeconomicus who wrote (5457)	1/1/1998 3:56:00 PM
From: Rational	Read Replies (1) \| Respond to of 27307

Bob: Good points about the Jan 60 call prices; they befuddled me too. You may be right that the last trade was a long ago where the price was too low. I think the April 40 calls traded Tuesday for $29 and they were up Wed, but on low volume. <<I guess those call buyers are geniuses. Guess what Sankar, it exceeded $70 3/4 already! For about a day and a half as a matter of fact.>> Not necessarily if the buyer is a specialist forced to buy and then short the stock to hedge (called Delta hedging) as Barb pointed out. I just have made a post to address the Delta and Gamma hedging and program trading which can be nasty when the call option prices keep falling. << Did you consider that the writers are more likely hedging longs or speculating bears? >> This is a possibility. The call price should keep falling, though, as I have noted. What was your paper on again? That is on option valuation not TA <G>. HNY! Sankar