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Southeast Colorado | He sold a $5.40 call but he recieved 75 cents for it. Therefore the market has to get to $6.15 before he it would be costing him any money. Granted if you took the 75 cents and spent it on something the market would ask for it back. Simply add the .75 to the 5.40 and you get 6.15 . The problem I have with his theory is that there are a couple of points in his progression where you have to determine when the market is going up to go long and then when its going down to get out. That is always the problem is figuring out when that is happening. Its easy after the fact but when it is crunch time it is hard to tell. The day you go long might turn out to be the key reversal day lower and vice-versa. I'm not saying he's wrong, and if it works for him then more power to him, I'm just saying that it could prove to be difficult to accomplish with success. | |
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Option adv ice
