Tuesday, August 18, 2009

[TheOptionClub.com] Re: Long straddle or Long strangle options

 

Hi kaichiew,

Since you are a newbie, I would sincerely suggest that you first consider understanding and paper trading basic long/short calls and puts.

Once you develop a solid understanding of how these basic building blocks work and how the dimensions of time, volatility and price (greeks) affect option prices, you will be in a much better position to combine them to understand how straddles, strangles and all other types of strategies work.

>> what are your opinions regarding this kind of strategy?

No options strategy is better or worse than the other and each one has their own pros/cons and risk/reward profiles.

>> currently what shares are suitable for this strategy?

All optionable stocks are suitable for all strategies (if one knows what he is she is doing).

Let me also mention that options trading is a life long learning process and turns out to the hardest thing that most people ever undertake in their lives.

All the best!!!

--- In OptionClub@yahoogroups.com, "kaichiew" <kaichiew@...> wrote:
>
> hi, i am from Asian country, Malaysia. I have not started any options trading before. But theoretically, i am quite familiar with the system.
>
> i have some questions that need you guys to help.
>
> may i know anyone who has used this option strategy (Long stranddle or long straggle) before?
>
> what are your opinions regarding this kind of strategy?
>
> currently what shares are suitable for this strategy?
>
> many thanks!!
>

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The goal of TheOptionClub is to provide a forum for members to work together for the purpose of furthering our individual understanding option trading.  All messages and postings, and any materials circulated are provided for discussion and educational purposes only.  No statement contained in any materials from TheOptionClub should be considered a recommendation to buy or sell a security or to provide investment, legal or tax advice.  All investors are encouraged to consult a qualified professional before trading in any security.  Stock and option trading involves risk and is not suitable for most people.  There is no guarantee that any information provided is accurate and, may in fact, be wrong.  It is understood that the participants in TheOptionClub have varying backgrounds and degrees of experience in option trading, and that regardless of experience each member is considered a student.  As such, any information distributed through TheOptionClub should be considered with a critical mind and not relied upon as an authoritative source.

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