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Comment by nprz | Hacker News Reader

Why buy call options? Why not just buy and hold equities?

I bought AMD Jan 2023 $90 options for $13 earlier in the year when AMD was trading ~$80. So the breakeven price is $103 by Jan 2023 which I found not very risky looking at the accelerating EPS growth.

Look how much I'm up by buying close to the money options instead of buying shares at $80: https://i.imgur.com/vYHl1LY.png

Yeah, that's kind of my thought here too. It honestly feels like the only reliable way to make huge stacks of money with calls/puts is knowing stuff that ought to qualify you as an "inside trader".

Why settle for 20% returns when you can get 500% returns? Only the lower classes are so risk averse. The rich understand that QE essentially strips risk from the markets

You can do the same with levered ETFs or futures, if you want to be levered to the hilt, at least do it with instruments where you don't run the risk of ending up losing everything even if the equities go up.

Because call options are a form of financial leverage, which is how the rich are getting much richer as the fed prints money

Call options are a rubbish way to do this, please don't spread this misinformation. If you want leverage, just buy the futures.

If you are thinking about punting your entire income into options on single stocks, and don't know what you are doing, just stop right there. You can easily lose everything even in a bull market.

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