Discussion in 'Trading' started by Nutinsider, Oct 20, 2012.
Well, what happened? Slippage on your stop?
No, i was fortunate in that i had a tight stop and was taken out after the first plane hit. The market, after stopping me out actually went back up a bit and then suddenly smashed down after the 2nd plane hit.
If i had a larger stop in that particular case, i would have had huge slippage, or may even been locked out when the markets were closed down.
ok, another brilliant reply from you
that makes about ten where all you post is "not true"
who are the traders making a living full time that do not need and use margin?
Guys - options are the classic instrument for hedging. However, that does NOT mean they are cheap....you'll have to pay a price for the hedge.
For instance, Copper has been moving fairly well recently, but margins are about 5500. And you get a margin call if you are down only 7 cents which is only about one-third of the limit move.
So going into the weekend, if you are long, you'd place a market order for the at-the-money copper PUT contract for the current expiration month. (Use CALLS for short positions in the futures).
WIth the above hedge, a limit move has little to no impact on your overall position balance.
long dotm puts.
very expensive over the long haul
for the few times they save your ass, you probably over the course of a year only break even
that is, you would be better off just taking the hit
like I said, 50% of the times these gaps go in your favor
I'm not in love with my positions, I can just close them out and get flat for very little cost, commissions aren't too bad, spread can be a little rough
Have any stats or account statements that prove that statement ?
dotm puts are cheap, but offer only some protection.
ATM puts are expensive, but offer full protection.
Options are flexible in that regard....pick your risk level.
no, only anecdotal
would be interesting to see the difference between options and just getting flat on the close
just because you are flat doesn't mean you aren't swinging, you can put it right back on on the open
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