Sell off, page-189

many of the other posts on this thread that aren't personal attacks have actually pointed towards strategies for how to trade with options. Buying short dated or underwater priced on the market options is a gamble not a trade as such. If you wanted to take advantage of the recent run on BHP then using your underlying stock to write a call option is a good way to trade in a conservative manner. From my experience with options it is the conservative strategy that goes on repeat that generates the best return. Options and other derivatives leverage your risk so if there is little risk in play then the outcome is more guaranteed and the likelihood of loss is mitigated. Losing money on positions and paying brokerage etc to do so is how you lose money.

As I posed earlier, perhaps a better way in which to have conducted this thread would have been to ask the question "what options strategy are people using on BHP?" had the nature of this thread been less bellicose and arrogant then perhaps some people would learn a bit about how the market works... there have been many comments about how people are trading using their underlying position in BHP which have been ignored by the supporters of buying underwater positions. A really simple strategy is to write calls and with the income from doing so then buying puts, its a boring way to trade but it is what lots of people actually do and I would imagine that on this thread there are at least 6 or 7 guys that seem to be trading in that way on a semi-regular basis. If you don't have the capital to trade in that manner then wiping out on extreme risk will never get you there.

apologies if that's already common knowledge for you, I'm just really surprised as to how vehement the belief is that the underwater position was going to yield significant returns. I love a punt and have bought short dated or out of the money puts and calls before but I treat that as a punt not an investment. I'm still genuinely curious as to what this chart that triggered the "sell down" looks like.