Hello Pezz, <<I don't know why you don't just trade options. Never seem to lose.>>
Most options expire worthless, and so it is statistically sensible to be a diversified seller of options. Selling put options on big NEM is exactly like selling options on a big pile of gold buried in the ground.
I treat the options market as a petty cash box and nothing more. I sometimes use the options market (short put) to accumulate a share position, and at other times use the options market (covered calls) as a dividend vein tap. I do not do options in size that would rival a fully allocated share position. The options game must remain a game, for me, to be done while passing the time scoping for the outsized opportunity or the Big Kahuna.
Message 18800755
April 5th, 2003
… This Chung Hom Kok Bay economy is a very strange one, where I sell put options on gold mining equities of properties located in far away places, to earn premiums from speculators throughout cyber universe, buy porkchop brunches from the beach kiosk, which then pays taxes that in turn is used to keep the beach clean and government employed lifeguards fed with instant noodles from the same kiosk.
Here in Hong Kong we no longer have a 'housing economy' because the capital value is dropping almost as fast rental price, but not as fast as confidence level and hope index.
We are also bidding goodbye to the service economy, because our factories relocated to other parts long time ago, and now, given the tepid financial engineering activity level and fast disappearing consumption urge, the demand for services has predictably dropped.
We are now coasting on the Chung Hom Kok beach bum economy, which in Silicon Valley would be called the Starbucks economy. …
Chugs, Jay |
