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Would yhoo be a good long-term(4-6 months) call option. Or, would an immeadiate put be a better investment?


Would yhoo be a good long-term(4-6 months) call option. Or, would an immeadiate put be a better investment?

You are talking like this is a crap shoot or a blind roll of the dice. What makes you think Yahoo will go up in 4 yo 6 months? You have to have a verifiable opinion in order to be an investor. Why buy an immediate put when the market is already down and you will pay dearly for a put on a volatile stock? The price of an option is comprised of intrinsic value and time value. Time value will always be the killer. Best advice: Buy a quality stock in a down market and wait for the market to turn upwards again, then SELL call options on your stock. You will win more times than not because you are not a financial risk taker then. You can only have an opportunity loss if the stock continues to go up after your stock got called away. Sell short term options only because "time value is always the killer" for an option buyer.

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