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You use the underlying to flatten the deltas.

The more protection you want the more you have to pay for it. There's no way around this. There's always a trade off somewhere. For example, you can buy put verticals instead of a straight put to reduce the cost, but the trade off is that you are not protected below the short strike. Maybe...

Forex options is an OTC market and the market that gets quoted to retail is a rip off.

Sounds like a plan! :)

Buy OTM calls and puts. Calls will hedge aganst inflation and puts will hedge against crash/depression. As for the World War III...if that should happen then I don't think your investments will be very high on the list of priorities.

Dividends are priced in. There's no free lunch! It's amazing how many people think that there's some free money to be made in something as basic as a dividend or a put-call parity. In fact, there's some irony in this - by chasing free money these people actually hand out free money to market...

Sure it's easy when the market is a one way street with no huge selloffs. Go back to Feb-Mar or last year when the SP was moving anywhere from 30 to 100 points in a day and see whether you would be able to close out before blowing up!

Yes, that hissing sound is the long weekend being priced in. :D And I meant the option prices staying flat not the price of the underlying. I really find it amazing that you are actually surprised by this! Are you really that naive? I mean, don't you think people would've thought about...

It can be a profitable strategy assuming you are actually good at picking direction. or as the saying goes, don't mistake bull market for brains.

There is a ton of info on the web so don't be too quick to pay for an options course. Try the OIC (option industry council) and CBOE websites first. Also check out the book recommendations on ET.

You bought the top Iron Condor rather than sold it (i.e. you bought the body and sold the wings). So you actually paid premium and you want the SPX to move to the wings. If you wanted to receive premium then you should've done the reverse - sell the body and buy the wings.

Don't you think this is something your should ask your broker and that your broker would be the best person to answer this question!?

Credit risk is minimal!? Think Lehman Brothers, Bear Stearns, AIG (although this one was saved),... Time is not an issue if its a long-term warrant.

Do you have any data to back up the claim that the commodity market dwarfs the stock market in size? If I'm not mistaken its the other way around, at least when it comes to the exchange-traded commodities (the OTC market may be bigger).

The main difference in this case would be credit risk. An ETF (a true fund not an ETN - exchange-traded note) doesn't have credit risk in case the fund manager goes bust as the assets of a fund are segregated. A warrant is issued by some institution, usually a bank, and therefore carries...

Hahaha :D Good one!

In case of Refco futures accounts didn't lose anything, only the forex ones did (along with other OTC).

Futures accounts are segregated so your money is fairly secure no matter what happens to the actual broker.

Actually, the further you go ITM the lower the leverage.