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.
Strategies & Market Trends : Systems, Strategies and Resources for Trading Futures
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: TradeOfTheDay who wrote (4702)9/25/1998 2:07:00 PM
From: Tom Trader   of 44573
 
Well you are kind, Bev

Yes, I do think that long straddles can work if one is nimble -- and that you certainly are.

I've been doing the same thing but, as is my wont, making it rather more complicated -- long a particular strike and short two times the number of options at a higher strike in the case of the calls. I get all of my premium on the longs--and more-- and have all of the upside up to the point where the strike is for the short calls. The downside is if the market rallies strongly then I'd need to do something to protect myself. The approach is a low transaction cost one--since I just sit on the position and wait for the optimal point to exit the longs and stay naked on the shorts till they become worthless or close to it. And if I miss the exit for the longs --like I did yesterday -- then I just wait for the next opportunity. Even if the longs and shorts expire worthless, I can't lose--will just make less than if I were to have timed my exit better.

But it does call for more capital than just straight longs--and it does explain why I need for the broker who I deal with to be competent when it comes to handling the orders that I place.

BTW, since everyone is speculating on what will happen after the next FOMC meeting I'll throw in my 2c worth. No cut and we go down big, 1/4 point cut and we have a knee-jerk rally and then a sell-off, 1/2 point cut and we see an explosive rally.
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