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Most only complicate an already tough game of picking the correct equity by adding options into the mix. Not to say there is not a place or a time for use of options but for most it is just another layer of gambling that ends up in capital losses. I would say for most that options and margin accounts are a costly mistake.
Most only complicate an already tough game of picking the correct equity by adding options into the mix. Not to say there is not a place or a time for use of options but for most it is just another layer of gambling that ends up in capital losses. I would say for most that options and margin accounts are a costly mistake.
This is really correct on the options front, you have to pick, be right and be right within the correct timeframe
I would disagree, options if your singly using a long leg require the correct underlying, direction, and time can be (and usually is) a losing trade b/c retail investors don't know how to do the research, read the IV and understand the strategy to employ. However, used correctly can hedge a position or portfolio, create income from positions by either using the rising underlying price to a predetermined/researched resistance and planned exit strategy OR by hedging a position/portfolio that is bearish and gaining income(premium) while doing so.
You can also protect positions and help with cost basis (as well as long-term tax issues) with options.
Using options to collar positions and the collar strategy also can limit risk and create gains/losses that are planned not just occurring. There is also the option spread which, as I always like to call them the "Defined risk strategy" play. You know exactly how much you gain, how much you lose if it doesn't play to your strategy, and all you're spending is the premium up front on the long side which is usually significantly less than the basic underlying play which it seems most retail investors/traders lose at. Ex. 100 shares ABC @ 50=$5000. 1 long contract ABC @ 50 strike=$50. If you can't exercise the contract, you close it at which you would only do ATM or if you've guessed right ITM and you sell the position at a small profit, which you take and move on to your next position or options play.
Now granted these are more strategies for traders, which is what the poster was really asking about, not long term holding positions, but can be applied in the same way.
Probably by reading the above posts, sorry for not holding your hand and quoting. Probably why the trouble with options for you. I get it now.
Feel better? Or do you need more specifics and a direct quote?
I don't have any problem understanding options so your broken English might be part of the problem. Specifics would be helpful if you were attempting to carry on a conversation. If you just wanted to post your rambling opinion no need to quote anything
No problem understanding option, um...okay. You no understand English obviously either or different option strategies also boss? No need to carry conversation, it's okay to admit if it's too far above your head.
No rambling there were exact examples, but again if you don't understand it's okay to say so instead of just ranting like a 2 year old throwing a tantrum.
No problem understanding option, um...okay. You no understand English obviously either or different option strategies also boss? No need to carry conversation, it's okay to admit if it's too far above your head.
No rambling there were exact examples, but again if you don't understand it's okay to say so instead of just ranting like a 2 year old throwing a tantrum.
I think it's your English that's the issue and I don't see any tantrum. Clearly you aren't interested in having an actual conversation on the topic and that's fine
Location: Was Midvalley Oregon; Now Eastside Seattle area
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Quote:
Originally Posted by txgolfer130
No worries, doing cash secured puts is ok also. The strategy with the CSEP is to buy the stock at a lower price, or at least have the stock at/below the strike but above the break even point. With selling puts, you are attempting to purchase at a lower price, not expecting the stock to rise (not at least in the short term). Your break even will be (Strike-Premium) the minimum value for that position you can have in order to avoid a potential loss. If you do sell an ATM put, and it does nose dive, that is the worst case scenario, and the premium as well as the IV will reflect the price action & possibilities.
The 3 strategies you want from CSEP's are: 1) buy stock below current price > sell put & get assigned by expiration.
2) Have stock maintain between strike written and break-even, you keep premium (may have unrealized loss)
3) Have stock stay above strike, put expires, you keep premium and you write it again, making income off the position every 30-45 days. 1 contract @ $1.50 premium is $150 - commissions.
Hope this helps.
My real problem is that the last time:
1. It was a recommended play from a friend.
2. I didn't do the Due Diligence
3. It was at earnings time.
4. It was Retail
5. Don't play in options.
I broke all of my own rules
I think it's your English that's the issue and I don't see any tantrum. Clearly you aren't interested in having an actual conversation on the topic and that's fine
Clearly you don't understand, or contrary to evidence, are new to forums and how to read timelines. English is not the issue, YOU instigated a rant because you can't follow a forum timeline or have issues understanding fundamental investing strategies. You feeble attempt to distract and obfuscate your limitations by implying someone's English is an issue is telling in and of itself. I'm sure you speak to clients or others that way as well.
And you're correct, I after seeing through your tantrum and off point rantings DO NOT wish to have a conversation with you and your opinions.
Good luck, you're gonna need it.
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