Comments on: Why I buy In The Money (ITM) options http://www.daxdesai.com/2008/07/01/why-i-buy-in-the-money-itm-options/ High Return Investing with Dax Fri, 18 Dec 2009 10:01:37 +0000 http://wordpress.org/?v=2.9 hourly 1 By: The World's Worst Stock Picker http://www.daxdesai.com/2008/07/01/why-i-buy-in-the-money-itm-options/comment-page-1/#comment-17556 The World's Worst Stock Picker Fri, 12 Sep 2008 14:02:44 +0000 http://www.daxdesai.com/?p=794#comment-17556 Hey, do not suggest people to sell naked options ever. That is a very bad suggestion. Option strategists need to be always hedged. 100% of the time. Hey, do not suggest people to sell naked options ever. That is a very bad suggestion. Option strategists need to be always hedged. 100% of the time.

]]> By: Weekly Dividend Investing Roundup - August 30, 2008 » The Dividend Guy Blog http://www.daxdesai.com/2008/07/01/why-i-buy-in-the-money-itm-options/comment-page-1/#comment-16538 Weekly Dividend Investing Roundup - August 30, 2008 » The Dividend Guy Blog Sat, 30 Aug 2008 11:02:49 +0000 http://www.daxdesai.com/?p=794#comment-16538 [...] In the money options [...] [...] In the money options [...]

]]> By: Mark Wolfinger http://www.daxdesai.com/2008/07/01/why-i-buy-in-the-money-itm-options/comment-page-1/#comment-14107 Mark Wolfinger Sat, 05 Jul 2008 15:37:57 +0000 http://www.daxdesai.com/?p=794#comment-14107 I. DITM options are not completely immune to effects of IV, unless the corresponding put is essentially zero. When the puts have premium based on a high IV, then that premium is reflected in the price of the call (keeping reversal/conversion market in line). I agree that buying ITM options is better, but sometimes you pay for the effect of high IV. II. Regarding earnings: Why not sell premium into earnings, instead of buying? I prefer selling OTM call and/or put spreads as an earnings play. I. DITM options are not completely immune to effects of IV, unless the corresponding put is essentially zero.

When the puts have premium based on a high IV, then that premium is reflected in the price of the call (keeping reversal/conversion market in line).

I agree that buying ITM options is better, but sometimes you pay for the effect of high IV.

II. Regarding earnings: Why not sell premium into earnings, instead of buying? I prefer selling OTM call and/or put spreads as an earnings play.

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