VOLTAIRE'S PORCH-MODERATED Message Board

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Strategies & Market Trends : VOLTAIRE'S PORCH-MODERATED

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To: jmac who wrote (27083)	12/22/2000 5:42:03 PM
From: Jill	Read Replies (1) of 65232

Buying calls and then rolling them out worked when QCOM was going to the moon and the NAZ was too...a little investment in OTM calls ballooned hugely. In this recently downtrending market though calls evaporate ten times as quickly as stock...and also you are paying through the nose for the premiums because of increased volatility. In general, ITM calls as RR does or edamo talks about, can be good stock substitutions though they too are risky in this crazy market. You can make good money on ITM calls on much less investment--they move point by point for stock. I guess you could also consider selling puts (a strategy that once burned me twice shy now), as you'd rake in tasty premiums, but you'd have to wait for a firm bottom in place which means there was an established reversal upward. We still don't have that. So you could get put. Or if you were feeling brave since we're up down up down you could sell puts on a "selloff"--but then again--what's a selloff? And then buy them back a few days later on a rebound. You can trade the puts, but you are always in danger of...for example...foundry warning and extr tanking...or cien buying a company and tanking...very volatile times right now

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