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

To: bcrafty who wrote (76742)	3/26/2003 5:07:53 PM
From: shoreco	Read Replies (1) \| Respond to of 100058

bcrafty, "Puts vs Calls"... Back in January I felt the same way I do now and I paid $27 for some March 900puts. I sold them for $47 and was happy as a pig in shit. They went on to hit $110 as I watched from the sidelines as I refused to pay the premium they were fetching. I had ample times to get back in in the $50's, but I passed... Then as the market dropped I started playing April 900calls. I paid $10 and $7 and they went as lows as $3 on the Wed. of the reversal. I wanted to buy more, but passed because I really though we were on our way to new lows and I could have got a discount on some higher strikes... Well, on day 3 of this rally I sold them all for $10 and made a little on my $7's and broke even on my $10's. I was happy as a pig in shit to get $10 (they were $3). They went on to hit $25 on Friday and that would have been 50k to me if I held, but I didn't. They are now back to $10 where I sold them, only the SPX was 35 points lower when I did... Calls are for suckers... When the "Vix" drops so do the premiums... IMO, Buy puts when the "Vix" is dropping because when it does turn and the "Vix" goes up, so will the premiums on the puts. I also started going out 2 months or more on my strikes to give it more time to develop... EOM Shoreco