Very interesting thread. Threads like these can lure a lot of people into the market looking for a quick killing - and result in them losing a lot of money.
Seems this guy has 50% chance of getting a call right. And when the market reverses will be back claiming huge profits - or claim to have hedged or reversed or taken new positions - or taken a small loss. Of course he is not alone - a lot of people do that - in all markets.
Newbies check the whole thread before deciding that using a simple strategy to buy/sell options and waiting - will make money roll to you.
With cash or futures market - you just need to get a right stock to not lose money,
with options market you need to get the right stock, right direction and correct timing to make any money. You may be very right about your stock, and your direction but for an August option to make money - target has to be reached before expiry on Aug 25 - which can be a huge gamble by itself.
When you buy options the advantage is - low risk - high returns - you only lose as much as you invest. But it is 100% of your investment - and in which business is a 100% loss considered acceptable - except when buying a a lottery or an insurance?
Just a friendly advise to ponder before deciding to jump into a similar strategy with options.
R
Seems this guy has 50% chance of getting a call right. And when the market reverses will be back claiming huge profits - or claim to have hedged or reversed or taken new positions - or taken a small loss. Of course he is not alone - a lot of people do that - in all markets.
Newbies check the whole thread before deciding that using a simple strategy to buy/sell options and waiting - will make money roll to you.
With cash or futures market - you just need to get a right stock to not lose money,
with options market you need to get the right stock, right direction and correct timing to make any money. You may be very right about your stock, and your direction but for an August option to make money - target has to be reached before expiry on Aug 25 - which can be a huge gamble by itself.
When you buy options the advantage is - low risk - high returns - you only lose as much as you invest. But it is 100% of your investment - and in which business is a 100% loss considered acceptable - except when buying a a lottery or an insurance?
Just a friendly advise to ponder before deciding to jump into a similar strategy with options.
R
