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This affords you the perfect opportunity to save yourself a great deal of mental anguish. You can manage positions based on current risk/reward - and adjust, hold, or close accordingly. It's certainly made my potfolio easier to manage. As a bonus, it really helps take emotions out of...

You can disable it yourself - but to do so you must give up trading options on those broad-based indexes. And that's giving up way too much. Mark

Only to the extent that a market decline will not be met with the same panic that was seen in 1987 - where many big players rushed to buy puts to hedge their portfolios. Mark

Just thought I'd mention that I was recently quoted in the WSJ online: http://blogs.wsj.com/marketbeat/2007/01/04/more-calm-waters-in-2007/ Mark

VETO

No one has categorized you (or anyone else). Mav was expressing his opinion that to be a successful trader, one must be good at either picking direction or timing implied volatilities. Period. His opinion. Not directed at you. Mark

What do you expect? A PM giving you a guaranteed winning trade? The discussion here is open-ended. Adopt any suggestion you like; forget what you don't - and then you're on your own. Mark

OK. I back off my opinion. I thought he concentrates so much on equivalents (important to a good understanding of options - no argument there), that his stuff was not of practical use. I retract. Mark

I'm not disagreeing with you. Knowing the equivalents is important. But, does the retail trader (account with IB, or OE, or Schwab etc) really gain anything? He gains undertsanding - yes - and that's important. But, I doubt he gains anything of practical use. All I really meant is that is...

To me, all Cottle does is show the reader how to use equivalent positions. Useful information, but almost worthless to the retail customer. Mark

True, but TS (as usual) was way off the mark. When I state that paper losses are real, I am not talking about bad marks. I am talking about losses resulting from an adverse movement in the price of the underlying. True, waiting it out can solve all problems involving paper losses (Unless...

I agree to a point. I am much more comfortable with positions that are not too close to the money. Each trader must find his own comfort zone. But, be careful here: "just waiting for expiry" can be very dangerous. Not saying that the 20 point move requires that the spread be adjusted...

Interactive brokers 75 cents per contract. No extras, unless you trade less than $30 per month in commissions. Mark

Yip, That's how I trade also. I'd rather try to make that 15 cents (and more) elsewhere. Mark

Very good analogy.