The stock replacement strategy

摘要

Most stock investors firmly believe that options are high-risk investments, only suitable for unrefined traders. But holding expensive stocks through turbulent markets can prove to be an even less civilized approach. October has historically been a dangerous month for equity investors and several analysts say this October may be historic in that regard. Using options, namely the stock replacement strategy, can tame the wildest of risks. Before we describe the stock replacement strategy you must understand one critical point: Options represent tradeoffs in risk and reward. They are not superior or inferior to stock, they present a different set of risks and rewards and it is up to each investor to determine which is right for him.