Rocket, I read the thread of discussion between you and edamo today. While I agree with you that DIM calls are expensive to buy, I think that if you buy them right, you're not likely to take the hit that you have suggested. Safety is possible in DIM if you are a prudent buyer.
Also, it seems to me that your opinion and that of ed differ over philosophy in terms of gambling vs. investing. For me, call buying is not gambling, but rather stock substitution (as ed referred to it). In that sense, I am more inclined to buy the DIM call. Buying OTM calls certainly is much more gambling than buying DIM calls.
As having the experience in being on the receiving end of edamo's critique, I can understand your feelings in this matter. Those feelings aside, however, I have to say that I think that ed's position in this particular matter is more clear, consistent and prudent. I understand what you are saying, but as an investor, I am not inclined to agree with you over ed (in this particular case).
A penchant for gambling provides me with the vision to make timely (albeit sometimes very risky) decisions. However, gambling is not my modus operandi. Investing is.
I appreciate your input on this and many other threads, and hope that you are not offended by my points.
Regards,
LoF |
