Join our investing community

Trading History Counts

Discussion in 'Shares' started by Tropo, 2nd Sep, 2008.

  1. Tropo

    Tropo Well-Known Member

    Joined:
    17th Aug, 2005
    Posts:
    3,394
    Location:
    NSW
    Tate on Trading - History Counts

    “.......As they say, history repeats itself first as tragedy, second as farce. The same can be said of markets and the people in them. Every so often a supposedly new brilliant strategy appears, the credit for which is claimed by someone who has been in markets for about 87 minutes.
    The latest doing the rounds is the notion of buying an instrument and simultaneously buying a put option for protection – this is known in trade as a married put, or in less experienced circles as a protected buy write (if you add in a written call to the equation), or using ‘insurance’. The strategy has been around since Methuselah played full back for the Mount Sinai under 11b’s.
    The basic premise is that in undertaking such a strategy, you can’t lose money – well, at least that is how it is being spruiked. The problem is that the people who market such ideas don’t actually understand how the strategy works - but they do know a good sales pitch when they see one”...
    More is below ....

    Enjoy :p
     

    Attached Files: