JC:
These sites will help you with your learning of options:
Basic concepts
cboe.com
Advanced Concepts:
cboe.com
Strategies:
cboe.com
In addition, if you write to the CBOE (Chicago Board of Options Exchange), they will send you what I understand is a free CD entitled: "The Options Toolbox"
This CD is an Excellent tool if you want to learn Options. from the very basic strategies (selling covered calls against existing positions), to more complicated strategies, (such as straddles, and others).
I never implied that selling puts was a risk-less strategy.
However... you have witnessed recently a market that has been very, very treacherous. It appears that there is no single "indicator", fundamental, technical, or psychological that seems to be yielding any sort of consistent result.
In this light, I suggest (I repeat, I SUGGEST), that people begin to learn a bit about options. Unless of course if you have the pre-conceived idea that speculating in options is equal to gambling in Las Vegas. In such case, forget my last two posts.
No, Options are not "easy" nor risk-less. And yes, it does require a learning curve and a degree of attention.
However, the markets we are facing, by no means will be "easy", nor risk-less. Therefore, learning how to use options as a strategy that can protect your current investments and if applied properly, enhance returns.
Buying calls, or puts based on the premise that "the risk is limited" may be a little misguided. While it is true that such limit exists, it depends under what kind of market one applies these strategies.
Buying calls under a bear market, it is almost guaranteed in most instances that the occurrence of losing the premium paid that has "limited" risk of loss, will take place every time.
A little research and study may make taking on a greater risk a better strategy than that of a limited loss risk strategy.
Again... Options are NOT without risk. it requires time to study them. It is another tool that can protect your existing investment, enhance return on existing portfolios, or take advantage of the volatility that the current markets are experiencing.
Please study the material before really making a move.
The above... is my opinion and by no means represents investment advice. (For that, consult your nearest Voodoo advisor). |
