Hyperinflation and calls

Discussion in 'Options' started by noob_trad3r, Oct 6, 2009.

  1. I ran some numbers and it seems calls would be more expensive if hyperinflation hits (ie 60% interest rates etc..)

    so a call that is worth 46 cents would then be worth 1.08

    I own lots of multinational stocks so I figure covered call writing would provide a good hedge in the future vs Fixed income?

    Just planning for the next 10 years
  2. If you can predict IR going to 60%, how do you know the IR won't double that, in which case, call writing will cost you a bundle.