freeus..ot
dell 2002 start trading 6/21......i only buy atm or ditm calls for stock replacements or with the intent to exercise...if you are correct and think a stock will have a massive move, perhaps double, you can sell one half of your calls, use the proceeds to exercise the other half, and basically you are home free on the position...did this with intc 99 this year, holding intc 0040,
use options wisely as a long term strategy to increase the size of your portfolio...
dell scares you?...say you are long 1000 shares, sell them at 35..now you have 35000, replace it with 10x0122.5 at 16...position is long 10 leap calls and 19000 cash...this is a very conservative tactic if you think near-mid term stock flat or down bias..if dell goes up, you participate..if it goes down, the call value drops, but you have cash to double the position at a lower point, when you think the turnaround will come...better than a stop loss... |
