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

To: E_K_S who wrote (55451)	6/13/2015 7:38:20 PM
From: Mattyice	Respond to of 78744

Eks - Just to clarify when I say I am short I refer to being long long dated put options that are out of the money. I'm not a fan of being outright short. To me it seems everyone is trying to be Warren Buffett, but one of the areas of the market that seems to not get much attention is these long dated option contracts which in my experience don't capture the true volatility and value or lack there of in the underlying asset. As you have hinted on If you have part of your portfolio with exposure to these especially in sectors or securities with odds in your favor, I think it's a good move. I will keep posting my inverted value plays. It's also interesting that the high flying high priced securities have relatively cheap or low volatility ( volatility is the premium or xfactor in the price of the option) where as a stock who is making multi year lows has extremely high volatility. To me it's sort of the same concept but probably explains why in most cases it seems wise to NOT purchase out of money calls on these as stock starts to rise or reprice you're at risk to lose money as volatility goes down unless the stock makes a several std deviation move in one day. Natty ice