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Strategies & Market Trends : Three Amigos Stock Thread

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To: Sal D who wrote (1319)3/2/1998 11:13:00 PM
From: Cary C  Read Replies (2) of 29382
 
Joe I have very limited trading experience in options. In the short time that I have been trading I've have found the following to be true..

1. The closer the options are to being called the more the price moves one way or the other based on performance. For example the March calls on a stock at 22.5 will move faster than the June calls at 22.5. It allows you more time for the stock to get there but if it moves up early, they won't move as fast as the March's would have. If the stock declines between March and June, you mat not be in as favorable position.

On the other hand it does allow you more room to ease the risk

Cary.
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