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Gold/Mining/Energy : Big Dog's Boom Boom Room -- Ignore unavailable to you. Want to Upgrade?

To: ChanceIs who wrote (84753)	5/18/2007 12:21:51 AM
From: manalagi	Read Replies (1) \| Respond to of 206325

Chancels, have you ever considered doing a synthetic long, selling puts and use the proceed to buy calls? In essence should the the direction of the stock goes your way, you are using OPM and the calls has little cost basis, or none at all. In other words, the leverage is just big.

To: ChanceIs who wrote (84753)	5/18/2007 10:46:56 AM
From: chowder	Read Replies (2) \| Respond to of 206325

>>> I would have had greater profits if I had held the stock, but I have less cash tied up and my potential loss is $6.40 instead of $39.55. <<< In theory, one could lose $39.55. In reality, who in the world would watch something go all the way down to nothing? Certainly not you. Anybody who did, deserves to lose their money. I don't do options because I haven't studied the strategies necessary to show consistent profits. Can you lose all of the $6.40? Does that happen if the options expire worthless? In that case, it's a 100% loss. Granted the numbers are smaller, but they do add up over time.