options w/ higher deep-out-of-the-money premium

A

amedhussaini

Hello,

I'm thinking about selling insurance, even though this is a negative expectancy system w/ the black swan looming up above.

Anyone have a quick list of instruments with high premium far out of the money (equities or commodities)?

Thanks in advance.
 
Quote from amedhussaini:
.....high premium far out of the money (equities or commodities)?
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The usual suspects:
1) Stock index puts
2) Energy, grain and precious metal calls.
3) Just remember, "high" premiums can go much higher. :cool:
 
Quote from ForexForex:

If you are expecting a "black swan" then you should be buying straddles/strangles. Black swans will wipe out your account if you are short.
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Not expecting one, just stating that I know there is always another black swan in the future.

I mostly added that line to the original post to deter any posters from turning this thread into one about how "that strategy is worthless yada yada yada", that same old story.
 
Quote from ForexForex:

If you are expecting a "black swan" then you should be buying straddles/strangles. Black swans will wipe out your account if you are short.
More...
It depends on what you're selling. On one side they help. On the other, they hurt.
 
if you're expecting a black swan just stay flat. chances are that you're on the wrong side of the fence - that's why is called a black swan.

i have seen many going bust holding straddles as well. holding a combos that offer just about 30% chances of profit on the long is close to impossible.
 
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