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Pete:
I believe, generally speaking (maybe that should read "theoretically"),
that historic volatility of the underlying is very important. The problem
is, IMHO, if you don't hold an option until expiration, then it's very
difficult, if not impossible, to take advantage of a difference between an
underlying's historic vol and its options' implied volatility. So this
becomes one of those theory v. reality debates, and we have to trade reality.
>
>There's the issue of historical volatility. How big a factor is that?
>
>Supply and demand for the optionm, per se, is dependent on so many other
>factors that it's not very meaningful to talk about that as an *operative
>factor* by itself.
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