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Strategies & Market Trends : The Millennium Crash

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To: smolejv@gmx.net who wrote (5253)6/8/2000 9:40:00 AM
From: LLCF   of 5676
 
<<In a downtrend, however...> the increased volatility strikes too, means the options are expensive to buy in the first place (My experience so far). Means it's sensible to go into/stay in the money. Which makes options a questionable proposition>

This is what happens when getting short becomes 'obvious'... ie. a downdraft, the market will take the options WAY up and make you pay. Often in the early part of the move, especially up moves, options will remain 'buyable', ie. fair or lower. Once things get rocking, they get overvalued, then the decision must be, is my expected move bigger than the markets.

DAK
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