Really? There is risk involved with investing? Wow! That guy is a real genius. And there is no way to lose 100% of your money in stocks? And we can't use stops in options?
Wow! All news to me......hahahahaha
Let's examine this stop thing. I guess it all depends where you place your stop but for arguement's sake, I will assume we place it just below yesterday low @ $19.55.
You bought @ $20.60. The possible loss if you are stopped out is $1.05 per share. You have 600 shares so the total loss would be $630.00.
I spent $990 for my position. If you are out at $19.55, then I have to sell my contracts at that time as well. I now go to the "options calculator" to see what my contracts would be worth.
According to the calculator the contracts would be just slightly higher than $1.30 per contract. If I sell all 6 of my contracts I get $780.00.
6 X $1.30 X 100 = $780
My loss would be a mere $210
I admit that the risk is higher, BUT, it's only higher if time runs out on you. Time is the enemy of options traders, PERIOD.
But hey Tina, this is why i always tell folks to paper trade for 3 months! Our example here is just that, a paper trade for comparison purposes only.
On a side note, no one will care for my money like I do. This why I get so annoyed by brokers that think they know what's best. They are just another bozo on the bus in my book. LOL
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