Ahhaha,
It seems that you must have had some nightmarish experience in options. Since I know a bit about them (I know more about options than most people (no bragging intented, and have been using them for the past 15 years!), I find them as another way to express my views. If I am bullish on FORE (which I am), I can express this view by buying the stock at 19.5, or buy a call option to express the same view (but with different time horizon and without committing the capital). For example, I can buy Jan 2000, call options with a strike price at 10, paying $10.5. So I pay only $1 premium, commit half of my capital, and have floor of $9.0 (10-1), as opposed to a theoretical floor of zero. If this too much for you, just ignore the whole message, but options can offer a very rich way of creating exposures to stocks that otherwise are not available. But, as you demonstrate, they are not for everyone which is OK!
Just my 5 cents |
