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Microcap & Penny Stocks : Bid.com International (BIDS) -- Ignore unavailable to you. Want to Upgrade?

To: Steve Fancy who wrote (16586)	4/5/1999 5:40:00 PM
From: Larry Newhook	Read Replies (1) \| Respond to of 37507

Steve, I agree with your comments. There is two important points here. The first is the delta of the options. Deep OTM options have a delta approaching 0, which means that as the stock moves the option will move very little. Also, is implied volatility. Option are priced via IV which for a typical stock is appox 25-35%. The higher the IV, the higher the option price. Because of these two concepts, it is possible for a call to FALL in value even when the stock RISES because of a low delta a IV collapsing. FYI Bid.com May 17.50 calls are now trading with a IV of 207.49 with a delta of 0.6351 and theta of about a nickel. Kinda pricey, but maybe a realistic measure of future volatility. Cheers. Larry.