GFP,
Get over your unnatural fear of options. This strategy is tailor-made for you.
You are very good at identifying stocks that are bottoming and about to break out. But, your excessive fearfulness keeps you out of trades. That's WHY you need to use options. If you want a good starter, watch CNBC's Options Action of Friday afternoons.
You were looking at GDXJ in the 24's the other day. Here's what you do: Buy the stock at market when your indicators tell you to. Also buy Mar, APR, or May in the money put options at the same time. So, you buy the May 25.6/21.6 put spread for $1.80
Today, the stock closed up $1.38, The spread declined by .20 - But, now you have insurance and can sleep well while your GDXJ runs. The options will continues to decline as the stock rises, but at a fractional rate. When you think the moves is over, sell the stock and buy back the option spread. Since they are May options, they will hold alot of their value for the next month or two. A single option, or a spread controls 100 shares.
MF4
