SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Gold/Mining/Energy : Newmont Mining(NEM) & Newmont Gold(NGC)
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: dwight vickers who wrote (122)4/21/1999 9:18:00 PM
From: ahhaha  Read Replies (1) of 587
 
I was an option broker for Starr-Kuehl in the early '70s and an option market maker on the PSOE. Before '73 I wrote options over-the-counter to the rich who could use the tax advantages that were discontinued with the advent of the listed market. I was a market maker mentor for years, an ROP, and wrote several academic papers similar to Merton's model.

As for the risk comment you simply didn't understand it.

Your assumption about limited down side risk with "beaten up value" stocks is all predicated on the assumption of the persistent of the long term bull market. You have to be kidding yourself about limited down side risk.

Sold straddle means two legs are naked. Just a matter of margin. You get a bad haircut shooting through brokerage houses on covered writes, so in for a penny, in for a pound.

If you're that good at predicting stock price, why all the hedging?

Take the stock, you missed the move. Fall below 8 1/2, sell more and you're selling naked and have to post more margin or you have to wait 'til they go out. By then the stock could be and usually is all over the board with your guts hanging out at every swing. Selling options on stocks below $10? How are you still operating?

If you are reducing risk, you are reducing return unless you are an outlier in the distribution. Funny thing about luck, it leaves you too.

Inferior to Internet stocks. "When you gotta shoot, shoot, don't talk." - Tuko.
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2025 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News