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Gold/Mining/Energy : Big Dog's Boom Boom Room
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To: The Reaper who wrote (111901)10/15/2008 1:56:54 PM
From: skinowski3 Recommendations  Read Replies (1) of 206209
 
buy the USO with it's inherent flaws and write out of the money calls ..... Premiums are pretty good

Another thing to consider is instead of buying the stock outright - sell puts, and accumulate at lower prices. Assuming that the decline continues for a while, you are likely to accumulate some. At some point the stock will bottom, and the last bunch of puts will become all profit - while the position increases in value.

Holding stock and selling OOM calls appears to be a "moderately" bearish strategy, while selling puts at these low levels is probably "cautiously bullish"... :)

I'd say selling covered calls is a better strategy during rallies, when facing Resistance, rather than at very low levels, when the probability of a reversal becomes higher. Jmho.
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