The only way you could answer this is by putting together the data and testing it.
Buying Strong Stock When the Overall Market is "Way Down"...Thoughts?
- Thread starter acroreef
- Start date
tell it to buffett who sell deep out of the money puts to accumulate positions.
Evidence?
Say you in a small plane 100 feet above the ocean, everything is going fine, and engine stalls and on fire, pilot say to jump, you jump, you barely live through jumping ten stories. You notice you have a slight cut on arm and notice you have attracted sharks, best way to have a chance is float on back putting arm out of water and act like a log. Pilot some how manage to land on his ski's without plane exploding and ask you to get back on board and try to fly out or wait for ship to come by which you see mile away. You have a choice of getting in plane and really dicey whether it will crash or worse or wait it out till ship comes to get you and wait it out till plane gets checked out well at airport and has a few flights by others so you not the Beta tester.
Sounds like an easy choice of one minute you in solid plane that can go to 10,000 feet up, but when something happens=bait.
So what do you want is based on what Pros do or what inexperienced traders do. Pro's have well back tested Trading Plan and inexperienced are Bait.
Sounds like an easy choice of one minute you in solid plane that can go to 10,000 feet up, but when something happens=bait.
So what do you want is based on what Pros do or what inexperienced traders do. Pro's have well back tested Trading Plan and inexperienced are Bait.
google Puts and buffet
because of previous personal attacks and now because of intellectual laziness you are on ignore<
make an effort to google for answers before posting.
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No where did this say warren buffet sells puts to be long stocks.
The article, dated in 2012, is saying to do a macro trade that warren buffet did 8 years earlier under very unique and specific circumstances (didn't have to post collateral and an abnormal demand for long dated vol fueled by a change in insurance regulations).
I have heard for number of years that most of the profits of Buffets plays were in options, one of the reasons I have gotten into option trading, plus to help close friend of mine.
Maybe cause all my regular trading has gotten stale and boring, but I am like kid in candy store with options, the coolest is putting them on to hedge Open profits.
Maybe cause all my regular trading has gotten stale and boring, but I am like kid in candy store with options, the coolest is putting them on to hedge Open profits.
Options are explosive -- they make equities/stock look like senior citizen bingo action.
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No. Most of the pnl comes from his operating companies (like a huge private equity firm). The operating businesses trade options to hedge and manage their risks but that will be small.
The infamous option trade will work out but it cost buffet his credit rating.