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Hi Kevin
Certainly volatility will work for you in this situation, however, the more
important figure here is your Delta exposure. As your long call goes deeper
against you, so will your Delta increase, until the option almost follows
the underlying future on a one to one basis.
Regards
Trevor De Vries
> -----Original Message-----
> From: Kevin Shin [SMTP:kalalex@xxxxxxxxxxxxx]
> Sent: Tuesday, September 01, 1998 10:54 AM
> To: RealTraders Discussion Group
> Subject: Gen: Option trade
>
>
> I have a basic question about option premium and volatility.
> If I have long call position and price goes down, everything's against me.
> However,,,if volatility increases rapidly along with falling price,,,would
> it help my option premium resist going down a little better than there's
> less volatility?
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