January 2012
Beginner
30 pages
27m
English
The investor can insure all or part of his/her holdings by adopting conservative option strategies. Following is a brief look at some alternatives. Keep in mind that the purpose of this piece is to introduce investors to the idea of using options. It is not designed to teach any specific strategy.
Options were designed as risk-reducing investment tools, and that’s how the intelligent investor/trader uses them.
First, let’s eliminate two common misconceptions about options.
The truth: Certain options strategies are complicated; however, you should already be familiar with options because you have been using simple options in your daily lives for years. Think of an insurance policy or a grocery store rain check. ...
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