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Strategies & Market Trends : Tech Stock Options -- Ignore unavailable to you. Want to Upgrade?

To: WBendus who wrote (47460)	7/8/1998 11:25:00 PM
From: Patrick Slevin	Respond to of 58727

ME? Offer a seminar? No, I have been asked to write articles, give interviews and also teach but I never did any of them because I am not qualified. A book that was reco'd to me by a CBOE MM is Option Volatility and Pricing by Shelly Natenburg. Evidently it's must reading for Option Traders on the CBOE. I think I paid 40 or 50 bucks for it from Amazon. I have only scanned it, as I intend to read it cover-to-cover during my holiday. It appears it was a good recommendation. I have had it since Christmas but have little use for options so I put it off. The Black Scholes pricing methods most likely can be found on the CBOE site or another URL....surely they are in a book somewhere. Glancing through a few of my books, the one that describes the model the most is Larry McMillan in Options as a Strategic Investment, Second Edition (He may be up to the fourth or fifth edition by now). He does about 25 pages on it, I cannot encapsulate it here. The actual formula is Theoretical option price = pN(d(sub1)) - se(to the power of -rt)N(d(sub2)) Where d(sub1) = (ln(p/s) + (r+v(squared)/2)t)/(v)(square root of t) and d(sub2) = d(sub1) - (v)(Square root of t) p = stock price s = strike t = time remaining, expressed as % of a year r = current risk-free interest rate v = volatility measured by annual standard deviation and N(x) is a cumulative normal density function. Too be quite honest, I know several option specialists. As hard as they try to help me out with the Greeks....the hedge ratio (Delta), the Beta, the whatever .....no matter how hard they try to drum it into me I still walk away as dumb as nails. They are either just too smart for me or the topic is too mathematical or both. So whoever told you I was giving Options Seminars was pulling your chain. The real option mavens are way outta my league.