Topic List | Page List: 1 |
---|---|
Topic | Stock Topic 11 |
red sox 777 09/15/20 3:34:11 PM #80: | Nanis23 posted... I have zero knowledge and experience regarding options so the put thing is not something I would do..for now at least Honestly, it's better just to bear the losses and not hedge. The market will sell you protection, but it will always cost something (and in some cases, it will be very expensive). The primary reason stocks go up is that they are risky - so they have to be priced low enough to you to compensate you for taking a risk. Humans are naturally risk averse, but the market isn't, and if you are, it'll eat your lunch. For example, suppose I told you that you had to bet $100 with me right now on a coin flip. Even though the coin is fair, you wouldn't want to do that, right? Now suppose I tell you that if you pay me 50 cents, we don't have to do the coin flip. You might take that deal. But then, if I repeat this with lots of people, each time I make 50 cents and I make a lot of money. If you repeat this behavior many times, you lose a lot of money. Every time you place a trade you are constantly being bombarded with these kinds of offers, and you really want to evaluate them based on expectation rather than fear or greed. --- September 1, 2003; November 4, 2007; September 2, 2013 Congratulations to DP Oblivion in the Guru Contest! ... Copied to Clipboard! |
Topic List | Page List: 1 |