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Strategies & Market Trends : Waiting for the big Kahuna -- Ignore unavailable to you. Want to Upgrade?

To: Real Man who wrote (59236)	8/2/2002 10:31:06 PM
From: J. P.	Read Replies (2) \| Respond to of 94695

Why would you choose options over futures as a leveraged and speculative investment vehicle? I see the usefulness of options only as a type of hedge or portfolio insurance against equities. Won't trade them for directional speculation. You can do all sorts of spreads etc. but you'll find no mathematical advantage. As long as there is a wide bid/ask gap in contracts the probabilities are always stacked against the retail buyer. Some advantages of futures: 1) Bid/Ask spread is only 1/2 to 1 tick (6-12 dollars). 2) If you are right about direction you have an immediate profit. With options you can be right about the direction and still lose due to time decay and bid/ask spread. 3) No time decay in futures 4) You cannot really set stops with options, with futures you can set very tight stops. there's more.....