I have been looking at the value of the zip options, ZIPO...

I have been looking at the value of the zip options, ZIPO exercisable at 30c by 1/12/2016.

Using the Black Scholes Calculator (many also available online) to value the options:

strike price: 0.30
stock price: 0.47
time (days): 757
volatilitiy (%): 100%
risk free interest rate (%): 6%
Gives a valuation of 31c, well above the current trading price.

Note: I normally use a risk free interest rate, as I value money in my pocket at this rate. I expect to get at least that return from any other investment I make with it. The interest rate is not overly significant in the calculation, a change of 2% only gives around 0.5c change in the valuation.

Volatility: Rates used are usually much lower, for example 30% for medium to large cap stocks. However this stock is and I expect will continue to be much more volatile than any other medium to large cap stock.
I have calculated the actual volatility from the share price history of ZIP, which gives a volatility of 160%.
Using a volatility of 160% in the calculation gives an option price of 38c, well above the current trading price, and not too far away from the stock price of 47c, so this seems too extreme.
Here is a sample of volatilites and calculated option prices:
40% 22c
60% 25c
80% 28c
100% 31c
120% 34c
140% 36c
160% 38c

Does anyone have personal knowledge of the volatility which should be used in valuing a volatily small cap stock like this?

Currently with the options trading at about half the share price, they seem to provide great leverage to any possible upside over the next 2 years. Also provide some risk management, if SP is below 30c in 2 years, simply dont exercise the option, thus providing less risk than other leveraged mechanisms such as a CFD or margin loan.