Silicon Investor (SI) -- The First Internet Community

STOCKTALK

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.

Strategies & Market Trends : Options -- Ignore unavailable to you. Want to Upgrade?

To: KY who wrote (1309)	1/19/2000 1:26:00 PM
From: SecularBull	Respond to of 8096

I'm a big picture kind of guy, and am not much for the details. I have to admit that its sort of a visual feel. No big method. I just looked at the portfolio numbers, and thought that I needed to hedge. LoD

To: KY who wrote (1309)	1/19/2000 1:37:00 PM
From: Poet	Respond to of 8096

Hi KY, I think there are just lots of ways to trade options. My training is in psychology so I tend to focus on the psychology of the market, as well as reading the charts. I'll sometimes daytrade options (as I did with ELON and often do with QCOM), but more often than not use options as a means to build core positions in stocks I'm bullish on. Perhaps some of the more methodologically-oriented traders can answer you as well.

To: KY who wrote (1309)	1/19/2000 1:49:00 PM
From: edamo	Read Replies (1) \| Respond to of 8096

ky.........puts, calls, gut feelings and software... the "experts" will speak of theory, formulae, the greek alphabet, which in a normal or slow moving market, allows the ability to analyse and set a position........ it's a whole new world.....the dynamic of a fast moving stock makes finite analysis worthless....by the time you get the answer from the black-scholes calculation, all the figures you took time to input have changed. it's actually easier to trade options in a fast moving market....the requirements are simply an intimate knowledge of the price action of the underlying common, and the ability to technically discern an oversold/bought condition in same.... entry position in a fast moving market is something that most don't understand....many prefer to chase....not wise if you are a buyer, and you want to use options as an investment vehicle, in the form of a stock replacement, then stay with ditm positions...they will move about par with the underlying, have intrinsic value and give the same leverage as a margin loan...to go dotm is pure speculation, but can return rewards with high risk. above all else, in any form of investing you and you alone must determine your risk tolerance and how it matches your investing goals......if you can't afford a loss of capital, then options should not be a consideration.... good luck

To: KY who wrote (1309)	1/19/2000 4:26:00 PM
From: Tom K.	Read Replies (2) \| Respond to of 8096

...I am getting the feeling that the decision to buy calls/puts is based more on "gut" feel than on a more rigorous methodology.... Ky, the more successful investors have a goal, and they use option trades as a strategy. For example, my goal is cash flow and my methodology and trades are oriented in that direction. Someone looking to buy stock below current value, would trade options in a different way. Someone with a buy and hold strategy may use LEAPs for increased leverage. Each has their own approach. The point is, it's tough to decipher what the strategies are behind the trades people make and what they talk about.... and then again, there are a lot of people that have no strategy behind their trades and simply trade for the emotional swings they get. My suggestion..... write down what it is you are trying to do (making money is a given) and look for a strategy that fits your objective.... and it may not be options. Tom