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Not necessarily....risk (probability) of ruin depends upon other factors
such as your option system success rate (your advantage) and how many units
that you divide your trading capital into.
Of course your "exposure" is greater with futures than with options, but to
imply that option trading is lower risk (ie, lower risk of ruin) than
futures trading because of the premium paid is wrong. A bad option system
will cause you to go broke just as quickly or quicker as a bad futures or
bad stock system.
MT
At 07:10 AM 7/3/01 -0400, Bob Fulks wrote:
>Because there is zero risk-of-ruin. With futures, you have to equity
>exposure both ways. With buying options, your downside risk is limited to
>the premium paid.
>
>Thus, you can safely use larger positions.
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