Capturing value in oil rise

**TOM4CWB** · Dec 28, 2010, 00:41

Wd9,

If you have stomach and cash,

buy an at the money put;

Sell out of the money calls to pay for the put.

If the price of oil rises more... double up and down;

buy another put;

Sell 2 more callsout of the money calls; to finance that put.

And keep it up till the market peaks.

**cottonpicken** · Dec 28, 2010, 04:46

Buy cpg and put it into your tfsa.

Tom,80% of options expire worthless.

**riders2010** · Dec 28, 2010, 06:26

Maybe I should buy a horse or invest in a running shoe manufacturer because alot more people will be walking! lol!

**FarmRanger** · Dec 28, 2010, 07:48

<i>"Tom,80% of options expire worthless."</i>

If he's selling calls, that must be what he's
counting on.

Tom, how do you make money buying puts and
selling calls in a rising market? Sounds like a
recipe for losing pots of money to me?

**TOM4CWB** · Dec 28, 2010, 07:49

cotton,

THAT IS WHY financing is done by SELLING CALL OPTIONS

IF truly there is an 80 percent chance the price will not change significantly...

Sell Canola, Wheat,or corn; for fall of 2011. All are UP BECAUSE of Black Oil.

**TOM4CWB** · Dec 28, 2010, 07:58

FarmRanger,

In the spring of 1996 I bought puts and sold calls.

I paid for the puts and margin calls by selling call options.

I have not done it since... lost my nerve.

Which is why I said... IF you have money to make margin calls.

I do not think we are at the market top... do not believe wd9 thinks so either.

When this gets toppy... THEN start selling calls and buy puts.

Alternatively;

buy SPE this spring from crop insurance and lock in high prices that are being caused by Black Oil prices being HIGH. Then the Alberta Gov pays the margin calls!

**wd9** · Dec 28, 2010, 09:24

Pardon my ignorance cotton, CPG? As in Crescent Point Energy?

**wd9** · Dec 28, 2010, 09:46

What about ETF's based in energy?

**cottonpicken** · Dec 28, 2010, 10:07

Sorry,yes crescent point.I probably shouldn't have
spit that out either,great company whose share
price will rise with oil but i haven't looked at their
hedge program.

Etfs are a great way to do it if you have a stock
trading account but not a brokerage(futures)trading
account.

I lost my etf list links but im pretty sure there is a
1x,2x,3x leveraged funds.Which means for every
dollar oil goes up the fund goes up 3x or down 3x
if oil goes down.

Tom,i don't think i can agree that crude is making
this stuff go up,they are all going up for the same
reasons,imo.

Capturing value in oil rise