i would say that would be suicide to play on that time span specially in options.... unless an unenticipated even occurs that u might ahve the vision for... chahine
With what degree of certainty can anyone forecast anything for that period of time?
I have never heard of any stocks like that.. I would be wary of predicting what is going to happen 2 years into the future, anyhow.. a lot can happen in 2 years after all..
I bet they've tried to make options like that, but the money probably isn't worth it. I guess you could sell 10 year 0 Puts and guess which companies will go bankrupt, but that sort of leaves the world of investment and borders on the world of raw speculation.
Hang on. Why couldnt u 'forecast' what would happen in 2 years? Atleast as far as forecasting relates with investing. I simply see it as the reverse of long investing. Currently i buy stocks that i see are clearly undervalued and expect to realize their fair value over longer term. Frequently, the investment horizon on an investment can push two years! (our portfolio turnover is somewhere between 3-5 years). I simply see investing in a long put as the reverse of the above. If i know a stock to be clearly over valued, i buy put at current market price with a long investment period. If anything i believe that predicting stock performance in the short term is more uncertain and speculative as momentum investing and other short term factors frequently lead stocks to price levels that significantly different than their fair value. Contrarian/Value investors make a career out of buying stocks that have been driven below their fair value by short term momentum and related factors. I just was wondering if there was a way to take contrarian position on overvalued stocks as well! Akaz
You have a point. Any forecasting of the future whether its one month ahead or 10 years is pure speculation.
LEAPS - Long-term Equity Anticipation Securities are long term options with expiration dates that can be up to 3 years away. Not all optionable stocks and indexes have LEAPS available. With the existing product competition the exchanges only create LEAPS for a stock or index if they feel there is a demand for them. LEAPS can be used for the long term investing or hedging. LEAPS are now available on many of the index option markets like the S&P500, S&P100, and NASDAQ100 indexes. There are many strategies using LEAPS that are highly profitable. One expert that is very knowledgable in this arena is Dr. Terry F. Allen - his site [url]http://www.TerrysTips.com[/url] is full of useful information as well as programs where you trade by mimicing(sp?) his actual accounts. Good luck. 23Shadows .
interesting first time i heard about LEAPS definitely requies a different mentality of trade i guess. and a lot of far "sightedness." chahine
I think you can guess, but at best its a guess. And why so rigid? You have to know the price of a stock a future date? Why not go to Vegas and have fun. I'd rather see some strippers and all you can eat buffets if I'm guessing on high/low on a number.