market options, calls and puts

[mncowboy]

How many of you use puts and call options as part of your risk protection. Have you had an experience with them, good or bad? Feeders seemed to have rallied and wondering if now is a good time to lock in a floor price while leaving the top side open?

 

[Stocker Steve]

Your going up against the big dogs computer algorithms, so tough to make futures trading work as an individual.

But, locking in some of your production at a profit is good risk management. Look into LRP. It works better for smaller operations.

I have never made money off LRP. It has protected my downside.

 

[BrazosBottomHand]

How many of you use puts and call options as part of your risk protection. Have you had an experience with them, good or bad? Feeders seemed to have rallied and wondering if now is a good time to lock in a floor price while leaving the top side open?

I've got some experience using futures and options and I don't like them much. They never seem to work like they are supposed to for me. I would say that they are a good tool if you really know what you are doing, but most of us don't. The broker always makes it sound simpler than it is. There is a "basis risk" no one ever talks about, which basically means the risk that your hedges aren't working like they are supposed to. Forward contract your cattle and be done with it.

 

[JParrott]

IMO - Options are the quickest way to lose money besides day trading. They're risk exposure, not protection.