I really appreciate the thread, I've been trying to understand options for sometime now. I have the assumption that CIti group will Rally in the next few weeks, and I am trying to figure out how to use options to make a play on it. It is at 33.30 right now and I wanted to buy dec 37.50 options at .20 cents, hoping they will at least double in the comming weeks and sell them before expiration. Can you tell me how what spread I could use to lower my risk but still make good money. It is easier for me if I get a real example of something that I'm looking at.
Don't buy cheap calls
if you think you would like to profit this month on a suspected move, use the "Time Value" in your favor. sell a put, yes you are the seller. or use covered call strategy.
But buying in a short distance your going to lose it.