02-03-2014, 08:51 AM
'Putncalls' pid='36952' datel Wrote:
'Stavros' pid='36942' datel Wrote:Sorry Puts but I have little understanding of the "games people play" when it comes to Options. Perhaps you can help me out with some further elaboration on how the premium ratio favors Puts by 33-50% over Calls. I was under the impression that the current Put/ Call ratio itself (not the premiums I admit) is quite low and as such bullish.
If you get the stock by buing it at 50 and selling the MAR call, your in at 46$
f you get the stock by sellling the 50 put your in at 45$
So the put prices are 20% higher than the calls. Given that the current price is 50.6$ I guess the calls are "in the money" and I should say that the puts are trading at a 10% higher value thant the calls. I would use margin at this point to sell these calls but Obama took away the margin interest deduction..
OOPs! I mean that if you think that there is not something "wrong" with IOC" at this point selling the PUTs not the calls is a good deal. What bothers me is that the market does not agree with my opinion.