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To: PAL who wrote (112046)	3/25/1999 12:42:00 PM
From: BGR	Read Replies (1) \| Respond to of 176387

Paul, I have read in thestreet.com (I think) that some option MMs for highly volatile internet stocks got killed where they failed to quickly reset the bid/ask in a dynamic environment, hence there days the volatility premium is artifcially higher that what the estimated volatility indicates. The example that you have given clearly demonstrates why it is in general preferable to go long the furthest out LEAPS calls, as the time premium is barely enough to cover just the risk free interest rate. For this reason, I think the Black-Scholes estimate is a consitent underestimate when it comes to LEAPS calls for an equity with considerable upward trend. -BGR.