SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Technology Stocks : Broadcom (BRCM)
BRCM 54.670.0%Feb 9 4:00 PM EST
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: pheolix who wrote (1947)6/21/1999 7:37:00 PM
From: Farfel   of 6531
 
I think your options strategy is much too complicated. Number One: O'Neill said to keep it simple when trading options----don't get into all the "straddles", speads (both Bear and Bull) and the like. Rather, just buy your calls or puts with at least 6 months until expiration.

Second: he said that he considered selling calls to be a really poor strategy because you essentially trade away all the upside potential of a stock for a small amount of premium. Consider how much the 60 Call goes for now on Broadcom----the August was a 5 bagger return on front money--------yet, if you had sold that call you would have only reaped 20% of that ----and there is still another 8 weeks left on the option------sounds like a "cheap" trade off to me. William O'Neill considers it a cheap sellout of your stock position.

If you want straight interest----then selling calls does return more than a CD----unless you are holding 3 Com as my friend was ----3000 shares he ate when the stock plunged as he sold his cheap calls---did he win or lose----he lost "big time"----those people are not paying you the premium for nothing----they are paying you the premium so that if disaster occurs, you, not they, are "holding the bag" and that "bag" will stink.

Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2025 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News