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Do I only risk 2% of the size of the order or the size of the order on margin. For example, let's say I have $100K in an account and but 100 shares of a $100 stock for $10,000. Do I put a stop in at $9,800 (2% of $10,000 subtracted from $10K) or $9,900 (2% of $5,000 subtracted from 10K)?

But back to my original question: How much danger using stop losses with Leaps? Am I going to get plucked off early and unfairly?

But doesn't adding short stock as a hedge for the long Leap call / short OTM call trade increase the cost of the trade -- and thus the return -- significantly. And if the stock gaps up? You are long one position and short two.

Why not stops?

With options?

Been doing some long Leaps calls and shorting front month, decent but unspectacular returns. I did have a mini-blow up on one stock (GS), however. What s the best way to protect the downside on a Leap calender call? Stops? How to pick the right price or percentage? Take the call income into...

Looking for a broker.

Pray tell: What are the strategies Fonatanllis prefers?

I'm pondering stops (market) on IB/Globex in the currency futures. I will be checking allow sop triggering outside RTH. Is this dangerous in that there is a period during the day when, there are no real bids and asks, and thus I could get filled at some ridiculous price. I know this is a...

Thanks much for the info and quick explanations.

Futures lack delta, too. But that doesn't stop people like Ansbacher from proclaiming deltra neutrality by shorting puts and futures.

Ok, we've mentioned bull put credit spread and an iron condor. But what I was really inquiring about was is there a way to get gamma neutral with a put writing strategy using futures rather than just off-setting options or heding a naked put by buying a further OTM call.

Is there away to get gamma neutral or close (and still make money) with a put writing strategy?

And apologies for the illiteracies in the last post. I have chaos all around me ...

Ok, so I'm puzzled over Ansbacher's new option writing strategy, which is to delta hedge short puts on the SP 500 futures with the futures themselves. So, let's say I write 10 OTM puts with a delta of 10. I would hedge with 1 futures contract short. Now here is where I don't get it? How can that...

What about the sucky spreads on Leaps, especially when you eventually close out the Leap. And when is the best time to sell the Leap -- when the time decay curve starts to steepen about 3-9 months out?

I can see how the risk is the same with a covered call as a naked put. But I would suspect the risk profile would be better with covered leaps, as less money is at risk on the downside. Btw, the put sellers who blow are usually margined, not those selling naked but cash-secured puts.

What's the downside of Tampa? Haven't been there in ages. I'm on the other side of the state and alwways thought of Tampa as a decent small city with a good number of jobs, for a Florida city, friendly good-looking locals. What's changed? Grown too fast? Too red neck still?

All excellent points and I know the naked put has the same risk profile as the CC on paper. But somehow it doesn't seem as risky. Must be psychological. To follow up, any good boks on Leaps and covered calls that address some of the issues mentioned in this thread. I have a 15 year old Leaps...