one in a lifetime event? recessions are not once in a lifetime events. I'm talking about buying puts to profit from a recession. If you DON'T think there's a recession coming, explain WHY you think that is so. Arguments like "the market looks healthy" don't cut it. Why will the market go up through 2nd half 06 and through 07, and not go down? You're judging and reacting to the "contrarian-ness" of the idea, and not realizing it's based on fundamentals and results that have been occurring over the past year. Our economy is headed towards a recession, like it or not.
i dont form opinions...deadly and detrimental; i just weight the odds and never look for sigma events that are unpredictable and need to happen exactly in your timeframe since u are purchasin' options; u are talkin' about a 50% drop in the next 6months for the major indexes. there's nothin' contrarian about your idea, is just another bearish trap mentality that has flooded the mkt and various boards recently, nobody knows if we are goin' into a recession, we could soft land and decline slowly makin' your deep otm worhtelss even if prices goes your way. fundamentals also are too complex for me and u to figure out and so uncorrelated to the mkt for long periods of time that any guess outside companies earnings and its short term effect for the mkt is just a gamble.
you are attempting to call both magnitude >25% and direction in a short time frame. That is a once in a lifetime call. My advice is to have you unwind your options positions on spy. Then place 1/10 of that in purchasing puts on the same strikes ES mini futures puts. you can thank me later for saving your ass
he needs the mkt to tank really fast in a precise point in time...i dont think the geezer really has a clue of how really things have to line up and if he has he's tradin' a vision...typical of noobers and gamblers.
the problem is the choice of strike and exp; it just wont do if the mkt declines at a slow pace and even it will tank all of the sudden lets say a month before exp his lottery ticket would have suffered so much theta pressure that delta wont react enough to cover his costs.
I agree with you & (especially) 'stream. Just one question though: Besides the tax advantages if his lottery tickets were to pay off (they won't), why do you say ES puts are preferable over SPY?