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Strategies & Market Trends : The Covered Calls for Dummies Thread
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To: TimF who wrote (4679)12/21/2006 5:00:00 PM
From: Uncle Frank  Read Replies (1) of 5205
 
>> That's true but its not very relevant to options purchases, at least not in some overall or universal sense.

Many of us feel that buying naked calls/puts is very relevant, and choose to sit on the dealer's side of the table by selling covered calls.

I'd contend that buying calls is never less risky that buying the stock. Leverage works in both directions, and those who go long the call must also contend with decaying premiums, so they're always under the gun. Some feel they can lessen that factor by dealing in LEAPS, but I can assure you from personal experience that it's much easier to lose a fortune in LEAPS than it is in stocks.

Good luck. If you decide to go long on calls or puts, post your results. I'd love to see you prove me wrong.

duf
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