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


To: Carl Worth who wrote (398)9/29/2006 9:36:17 PM
From: pcyhuang  Respond to of 4080
 
Carl:

Thanks for pointing out the error in my equation.

The equation: Long Stock = long call + long put

should have been:

Long Stock = long call + short put

pcyhuang



To: Carl Worth who wrote (398)10/2/2006 9:22:47 AM
From: bluesongs  Read Replies (1) | Respond to of 4080
 
Thanks for the option discussion. I am trying to replace some of the income that the mild weather has inflected on my Canadian NG trusts and spread out to other sectors at the same time. I find the many of the stocks mentioned here make sense for the long haul and the extra cash from call premiums makes up for the lack of excitement.

I have often been amazed at the price of out-of-the-money call premiums on gold stocks and even our IMCL. I attribute that perhaps incorrectly to another option strategy seldom discussed and that is long calls short stock.

I have watched this strategy work well with controversial hi beta stocks even though it defies logic (mine anyway). Buying puts would seem smarter.

Blue