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Strategies & Market Trends : Options for Newbies -(Help Me Obi-Wan-Kenobe) -- Ignore unavailable to you. Want to Upgrade?

To: Mr.24K who wrote (749)	2/27/1998 4:59:00 PM
From: Zach E.	Read Replies (1) \| Respond to of 2241

I thought option prices usually follow stock prices Other people can probably give a better or more complete explanation than me. Basically, there are three primary factors in an option's price (excluding dividends which aren't a factor for CIEN, I would guess). The first, price of the underlying stock was up a little. The second, time premium decay, always works against you, and may have more than offset the first factor. The third, implied volatility, is a bit of a wild card and may have been a factor as well. In any case, if CIEN makes it above 45 before March expiration, you will see the options go up no matter what happens with the second two factors listed above. Zach