Hi Coug,..Re:<<where as with futures, I see a infinite loss with a bad trade >>
That's why I started out doing options on futures and have never gotten around to trading the underlying, although, bonds look pretty easy. But options on futures carries the same baggage in that, if it doesn't immediately move your way and you don't get out, then it's downhill from there unless you got further out options and have a little extra time. But further out options don't have the same volatility (read gains/losses) of the near month.
Options, however, provide all kinds of opportunities to either hedge or bail. For instance, if selling a Dec. bond call and bonds move up, then you can always buy the next strike up to limit potential losses. Looks like selling options is also the best way to capitalize on sideways markets too, just have to remember to get out after a big move (when premium gets stripped).
Regards,
Lee |
