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Strategies & Market Trends : Rande Is . . . HOME -- Ignore unavailable to you. Want to Upgrade?

To: Kanetsu who wrote (49436)	3/19/2001 10:42:55 PM
From: rocklobster	Read Replies (1) \| Respond to of 57584

Well,, Love a civilized argument as well, my only disagreement with your scenario about being called out is you say if you get called away and have to buy back, all you will have is a loss on the option and a possible loss on the stock if it goes down after you rebuy. However, it is impossible to lose money selling an option. sure you lose the spread and you lose the commission, but you collect the premium, and once it's collected, it's your's forever, unless you decide to buy back the option at a loss. and the only reason you would do this is to avoid being called out of the stock. which I personally wouldnt do if the option strike was out of the money anyway, because I would have the option premium in my pocket plus the profit on the stock. I do agree with your point about the typical online investor not wanting to try this at home..hehehhe if you will excuse the humor.. I just read on another thread, or perhaps it was this one, can't keep them all straight, that 95% of online investors either underperfom the market or lose money. So there is not much that the typical online investor would be advised to do besides buy index funds and pray..LOL.. The naked straddles thing sounds interesting. Please send pics so I can see if my girlfriend would be into this. rok

To: Kanetsu who wrote (49436)	3/20/2001 1:16:58 AM
From: Dennis O'Bell	Respond to of 57584

Michael Burke has always been in favor of use of options to create a nearly risk-free "maximum income" portfolio, but it takes some work, possibly more than many are willing to do in order to get it right. You can see some of his thinking on his thread (use a search to find other messages) Message 6301313 Message 15217577 etc... There are some well known textbooks but it's nice to hear what an experienced and successful trader really does.

To: Kanetsu who wrote (49436)	3/20/2001 9:53:59 AM
From: Rande Is	Read Replies (2) \| Respond to of 57584

. . .sounds just like my ex-brokers explanation. Remember it's your brokers job to get a hold of as much of your money as possible. I found that options were some of the most misunderstood instruments used by traders. And one more way that smaller individuals could lose in a big way. But I am happy to say that one of our best traders, who has been trading nothing but options for several years now and has done extraordinarily well. . . will be leading a board for us . . . and will share some of his secrets and successful methods. I've met him personally and can say that he is as good a person as they come.