Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Biotech / Medical : Ligand (LGND) Breakout! -- Ignore unavailable to you. Want to Upgrade?

To: Flagrante Delictu who wrote (19273)	4/18/1998 12:49:00 AM
From: Russian Bear	Respond to of 32384

Bernie, ...OFF TOPIC... You make a good point. There is, indeed, a great deal of uncertainty inherent in situations like the one you describe. I, too, have had the experience of being assigned shares (long or short) that closed a fraction out-of-the-money. Conversely, there have been times when slightly in-the-money assignments were not made, despite my expectations to the contrary. It just goes to underscore your point: different players make entirely different decisions in this situation. Personally, I am not much of an options player. Usually, I am content merely to write at-the-money puts and/or calls that have about 5 to 10 trading days left to expiration. (Preferably, ones with high implied volatilities, and on stocks I know.) I find that I generate substantially more "winnings" than "losses" this way. When I am assigned, I simply exit the position soon afterwards, taking the result (usually a small loss) in stride. Maintaining the additional exposure over the weekend does not bother me, because I only choose stocks I would have no qualms about owning (when selling puts) or shorting (when selling calls.) Also, I try not to go overboard with position size. I have also put on some diagonal spreads, in the past. I get the distinct impression that you are a seasoned veteran of the options game. I would be most curious to learn whatever details about your options activity you cared to share. Regards, RB