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The Long Shot

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Uploaded by on Jul 30, 2009

Kevin Matras talks about using out-of-the-money options for long shot, or "lottery ticket", trades.

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  • The 9dollar calls with Ford @11 profit is5200not5263,these calls with Ford@14 profits13,000not13,157.The 10dollar calls with Ford @14 profits18,800 not 19,047 all excluding comm.He should have explained that all option prices are based on 100 shs. of the underlying stock per contract,I teach option education,I tell people when viewing an option price always move the decimal 2 places to the right to see the true dollar value or cost per contract.To learn options contact me at jerrym300@gmail.com

  • An error made in this LONG SHOT video will confuse the novice option investor. He states the 9 dollar strike Ford call bought at 38 cents would buy 2,631 call options for 1000 dollars. An option contract at 38 cents equates to a cost of 38 dollars per contract which means for 1,000 dollars 26 contracts can be bought not 2,631 or 26.31the true profit for the 9 dollar strike with Ford at 10 is 2600 dollars not 2631.00, the $10 strike at 21cts=47calls, the profit with Ford at 11 is 4700

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