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 : Zeev's Turnips - No Politics
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: FR1 who wrote (4708)11/11/2001 12:25:51 PM
From: mishedlo  Read Replies (1) of 99280
 
I think most of the average players are just gambling because there is no way to know with any certainty which way the stock will move.

That has to hold true for common as well.
Can anyone guarantee me which way a stock will move.
There were people buying, holding AMZN JNPR JDSU all the way down. Leap puts would have been a great play. Leap calls would have been a 100% loser. But holding common from 150 or whereever on JDSU until now is also nearly a 100% loss. JDSU will never see 100 again and even if it were someone could buy it now for next to nothing.

If a stock moves then common will move as well.
Let's say I want to buy 1000 shares of XYZ but instead buy a call option. XYZ falls 50% for whatever reason. I am sure the person buying calls would be better off than person buying common. This assumes one would have held to the bitter end, but perhaps something just drops overnight 50%, like IRF did this past summer.

At any rate, if there is an expected trend for some period of time (like Zeev is calling for next year), then leap calls would be quite conservative.

But yes, I agree, one must pick his spots carefully.
In a sideways market, advantage is clearly to the option seller. In a strongly trending market, advantage is to the option buyer. Also there is a theoretical unlimited loss potential on shorting. There is a known loss limit on options. Another possible use? How about put protection in front of earnings if one wants to hold long term but is afarid of the current quarter.

I intend to buy some leap calls in Dec, if Zeev can just talk this market down one more time.

M
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2026 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News