Reply
Senior Contributor
Posts: 216
Registered: ‎12-04-2010
0

Marketing

Ishamel,

 

Buying courage call's right now so that I can feel comfortable hedging later. Surely we will get a 20 to 30 cent rally from her!

 

The tipping point's post was accurate right down to the last sentence. I always wondered why this place is almost deserted.  Now I know who is responsible.  

Veteran Advisor
Posts: 1,559
Registered: ‎10-18-2016
0

Re: Marketing

Paying what, 10-20 cents for calls in the hope that later you can sell the board?  A person starts out 10-20 cents in the hole already on options.

 

Options as insurance make sense to me.  Options as speculation, I don't know.  

 

If one expects the board to go up and then sell it, why pay for options which are money spent and reduce the return on the sale of futures?  If one doesn't think the board is going up, why pay for options that are money spent?

 

Options make make money for brokers and the competent option sellers.  

 

 

Honored Advisor
Posts: 17,966
Registered: ‎05-13-2010
0

Re: Marketing

Isn`t the game that has to be played now, contract below your cost of production and protecting that forced decision with a call?  I mean to buy a put under your cost of production is probably higher than buying a call over your C.O.P  ....whatever that means Smiley Happy  

 

One of the gurus talking about contracting hogs during the height of this African Swine Fever hype...."yes, but what if you contract $90 hogs and ASF hits and you don`t have any to deliver?" .  Thought being if ASF hit here who knows, they could be 10 times higher, and then what would you do? 

 

I guess with the grains if you think 20 cents below your COP is the best the market will do and you can get by bleeding a small amount of equity, that`s okay But have a call in place so that if Yellowstone blows you can take advantage of any long shot market appreciation.

Senior Contributor
Posts: 216
Registered: ‎12-04-2010
0

Re: Marketing

Jim,

 

You could be right.  We will see.  I will let you know how it comes out>

Highlighted
Veteran Advisor
Posts: 1,559
Registered: ‎10-18-2016
0

Re: Marketing

BA, in all my life I don't think I ever filled an inside Royal Flush.