Options Traders Considering Buying Puts: Something to Ponder

01/29/2016 8:00 am EST

Focus: OPTIONS

Seth Freudberg

Director, SMB Options Training Program, SMB Capital, LLC


Options expert Seth Freudberg, of SMB Options Training Program, talks about something he calls a perfectly ineffective hedge.

Many options traders buy puts in a panic thinking they will control downside risk in their trades.

We did a study on weekly options and found that they were incredibly ineffective at controlling downside risk over the last year.

In fact, traders would have made much more money selling puts over the last year, which is counterintuitive and something to ponder strategically.

To watch this video, click here…

*no relevant positions

By Seth Freudberg, Director, SMB Options Training Program

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