Good point. I only have experience with equity options and I have no experience with options on futures so I'm just trying to stick to what I'm familiar with. Are options on crude oil futures also subject to the 60/40 tax treatment like futures?
I bought a bunch of Jan 08 VLO 50 calls. I feel it tracks oil pretty closely. Bought 'em at 6.47, but not sure I'd pay more than 7.25 right now. Given the recent strength, I'd wait if I were you.
don't buy USO, it's the worst ETF out there because it doesn't track the spot underlying but the futures which have to be rolled over every month.
FYI, I spoke with Jim over at USO, he said USO options should be coming within the first quarter hopefully. They are working with the SEC. We'll see.