POT - Seeking strategy advice

J

jgiasi

Hello,

I am looking for some options or options combined with the underlying strategies.

In a generic sense, what I am looking for is a hedge type position when I have a preconceived notion of where an underlying is heading.

For example, POT has had a nice run up and is clearly in an uptrend. Prior to yesterday, the run up was followed by several narrow range, indecision type bars. Yesterday, provided a decent size drop. Over the course of the narrow range bar days, I would have been inclined to initiate a long position. However, yesterdays drop would have hurt. Therefore, I would have liked to have some downside protection. Unfortunately, I am not tremendously savvy with options strategies outside of the basic positions.

Can anyone recommend some ideas given my dilemma.

Thanks, Jennie
 
Hi Jennie,

If your looking for option strategies that combine the underlying pick up Coach's book..."The Option Traders Handbook..Strategies and adjustments" by Jabour/Budwick. It has many suggestions for combining options with the underlying to hedge or maximize gains. You can read reviews of it if you go to the book section in ET.

A bullish strategy might be a ratio spread or if you want to hedge then buy stock/buy put. Can always sell the put if you want to own the stock for cheaper..many different "options" good luck.
 
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