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thanks. i want to do this: buy 100 shares of a stock at 88.00 per share on a wednesday. then immediately buy the 88.00 put expiring that friday for 1.00 per share. then when earnings report on *thursday*, my stock is protected going into friday. total investment: 8900 three scenarios can...

hello, i'm interested in understanding the efficiencies of writing an at-the-money protective put expiring on friday, when the earnings announcement is on the prior wednesday or thursday. sometimes i want to buy a stock, but it is right before earnings. i was hoping that since the time decay...

thanks. is that bad? can I immediately buy the 30 shares to close out? what would the effect of that be?

hello i have 70 shares of a stock. i want to buy a put to protect against downside loss (avoid a gap down). can i exercise the put and assign someone 70 shares? the puts are in increments of 100. thank you

Thanks, Robert. That makes perfect sense. You have to have the price jump outpace the net cost of buying both the options. Also, you made a great point about the implied volatility- a stock that is likely to move a lot will have a more expensive option. So you have to outpace that as well.

Hello, I heard that straddles are used when you are anticipating a large price movement, but are unsure of the direction. You are supposed buy at-the-money puts and calls. But if the stock goes up, the put loses value. And if the stock drops, the call loses value. So how do you make money...

Thanks. So Forex is the place to start of for a day trader? I'm used to equities. But for day trading, maybe Forex is the main place to be.

Hello, I see pictures of day traders with six computer screens and all sorts of stuff. Is there some sort of recommended must-have set of tools for a day trader? For example, with my existing computer, I can watch the chart of a stock over the course of a day. But I don't think I have the...

I see. I believe you are looking for "salvage value". If the company folded, you would own your fair share of the assets that are left over, after bondholders and other people in front of you get paid off first. So if there is a company like "Shoes World", there could be a lot of shoes that are...

Thanks. That is an interesting point about the VIX.

I'm looking at a stock that went up rapidly. As a consequence of the rapid price rise, the stock has many surprise deep-in-the-money calls (they started out far out of the money) that are going to expire tomorrow. Can the expiration of these options affect the share price of the stock? I'm...

I think you are asking this: Does a share of stock have a nominal value, like a currency. For example, independent of the current selling price of a share on the open market, can you go sell the paper asset of the stock for 25 cents or something like that. So if the stock sells for $100 per...

That is interesting regarding earnings reports and subsequent less certainty. I didn't know the price of the options would drop regarding that.

Hello, Suppose a stock runs up a *lot* (too much too soon), and you are confident it will retrace. Do you typically wait for meaningful down day before buying puts? I saw a nice top, but waited. I even had the luxury of being able to make a decision immediately after an earnings report, thus...

I'm too new to have a theory, LOL.... I'm a beginner. I'm on about page 3 of a 1000 page book with this stuff, metaphorically speaking.

Is this well-established truth? If so, this is a very easy and useful axiom to remember.

Unless I looked things up incorrectly, LDRS does not have options. That is a drawback.

Thanks, What is a 15 delta? Does that mean a 15% chance of being in the money?

For example, look at the charts of the following bond ETFs: AGG, BND, LQD, BIV. Do you really want to walk into that?

Hello, Suppose a stock is trading at 100, and the probability of a 90 put being in the money is 15% Then suppose the stock falls to 95. Does this mean the probability of an 85.5 put being in the money will also be calculated as 15%? The 95 put is 95% of the 100 selling price, and the 85.5...