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.
Gold/Mining/Energy : Big Dog's Boom Boom Room
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: kodiak_bull who wrote (43523)5/5/2005 10:46:55 AM
From: RWS  Read Replies (1) of 206338
 
Nice trade.

I would suggest that anyone who has an account with only $3000 should not be trading options.

It is safer to follow an options trading strategy that uses a small percentage of the account with the rest in cash or treasuries. The large percentage gain or loss on the risked capital in the options trade is a much smaller percent of the total account.

To compare apples to apples one would assume a comparable amount of total capital in the portfolio. I assumed $25k as an equivalent for the two trades, and they come out about the same percentage gain.

Assuming one would establish a hard stop to prevent total loss of capital the risk of capital in the other trade would not be 100%.

I prefer your trading strategy in this environment, but the best gains and worst losses to my portfolio from trading options is usually less than 3%.

RWS
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