Lenny Dykstra DITM strategy...

A

Algorithm

a link to articles by Lenny Dykstra (famous Mets baseball player) and his "Deep In the Money" options strategy and calls. I'm not advocating anything in these articles, just thought it was a nice, easy way to access a series regarding options. Just one strategy amongst many, some may find it interesting while others may not. Just wanted to post some current options commentary.

Have fun with it:

http://find.thestreet.com/cgi-bin/texis/author/?au=A1100645

Happy Trading!




(interested to see the ensuing comments)
 
... damn, the american dream indeed.

great rich playing a game, get richer playing an even more exciting game....

there ought to be a law ..
 
Scary.

On an unrelated topic, I attended an "advanced" options seminar hosted by OIC last year. I believe Jim Bittman (CBOE) was the speaker. I quickly arrived to the conclusion that the majority of option education sponsored by exchanges is heavily slanted at making traditional stock investors more comfortable spending money in the options markets. There was no discussion in the risks unique to options contracts nor anything on the specifics of an options price beyond the underlying price. It was actually mentioned by Mr. Bittman that the normal career progression for an option investor was the following strategies.

Novice - Covered Calls
Junior Intermediate - Long Naked
Intermediate - Verticals
Expert - Short Naked

As I sat through this seminar I could almost see the wealthy execs at the exchanges rubbing their hands together and drooling at the prospect of getting Uncle Joe and Aunt Jinnys money. Perhaps I overreacted however, I feel it's criminal on the part of the exchanges to encourage option trading without educating the risks unique to options in a educational seminar.

Back to topic and putting my conspiracy theory hat on, perhaps Lenny works for the exchanges and is trying to lure stock investors to options with the golden leverage carrot. Or, perhaps Lenny has no clue what he's doing. Either way, I feel it's negligent (at best) to "educate" the public with an options strategy without identifying the inherent risks of such a strategy.
 
Reading Lenny's article about DITM a few weeks back, left me disgusted. With this TheStreet attained another low: Lenny's options advice is just another trap for the uniformed ... (worse than Hooper, Terry, etc.).
Quote from Algorithm:

a link to articles by Lenny Dykstra (famous Mets baseball player) and his "Deep In the Money" options strategy and calls. I'm not advocating anything in these articles, just thought it was a nice, easy way to access a series regarding options. Just one strategy amongst many, some may find it interesting while others may not. Just wanted to post some current options commentary.

Have fun with it:

http://find.thestreet.com/cgi-bin/texis/author/?au=A1100645

Happy Trading!




(interested to see the ensuing comments)
More...
 
I don't know much, but I do know this is:

"If you held or the rally didn't provide enough of a gain on Monday, what do you do next? Now is the time you have to go in and buy more! With the stock getting hammered after its earnings, I would put in a GTC order to pick up that same July $60 deep in-the-money call for anywhere between $8 and $8.50 (we previously paid $12). "

... is assanine.

Missed earnings, Stock Got Hammered, GO LONG!!!!!!!
 
Kind of like Lenny also saying...:

"If you swung and missed that 98 mph fastball over the outside corner, then keep swinging for that same pitch everytime because he has to throw you the same pitch again!"
 
Possibly just more celebrity chic that's proliferating the world of finance these days. After all, actors seem to be popular politicians, why not ball players as financial gurus. I read and followed through his Dow Chemicals play (DOW) and boy you had to play it just right to be profitable. If you didn't take profits on the day he stated he took profits, you would still be under water on it. But, to give Lenny his due, he did state he always enters a GTC exit order and monitors his positions.

Although I do find it interesting that he really doesn't discuss cutting losses and if anything, seems to be averaging down without really explaining in any detail his reasoning. No real in-depth mention of the technicals or indicators he's watching (if there are any at all). During a bull, Lenny should do well. Although he stresses buying "quality" companies on pullbacks/dips and gives some company fundamentals with his picks, his strategy doesn't appear much more than following the overall upward trend/momentum of the current market.

Thought some would get a kick out of it.
 
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