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Give me one reason not to buy silver calls

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November 04, 2010 – Comments (12) | RELATED TICKERS: SLW , SLV , AGQ

I am staring at january 2013 silver calls, 25 dollar strike.  They are 5.85.  The 2012 ones are 4.35  Talks of QE3 and QE4 and bush tax cuts are under way.  Somebody pleeeeease tell me why I shouldnt buy the hell out of these before I do it.

12 Comments – Post Your Own

#1) On November 04, 2010 at 3:09 PM, SkepticalOx (99.44) wrote:

Um. I got one. So you don't make the calls more expensive for me to buy!

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#2) On November 04, 2010 at 3:34 PM, ikkyu2 (99.15) wrote:

Because the silver market has been cornered before?  Viz, Hunt Bros, 1982.  It's been done since then by others.  You don't know who's selling those calls.  It might be someone with the ability to depress the price on the maturity date.  The silver market is not very big and someone with a few billion to throw around can make it march to their tune.

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#3) On November 04, 2010 at 3:36 PM, 100ozRound (29.38) wrote:

Because you should be buying SLW calls instead...

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#4) On November 04, 2010 at 4:54 PM, mtf00l (45.84) wrote:

Brass and copper jacketed lead? =)

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#5) On November 04, 2010 at 5:05 PM, chk999 (99.97) wrote:

A lot can happen between now and Jan 2013. Look at the price of gold in Jan 1980 and what happened after that. PMs are volatile.

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#6) On November 04, 2010 at 5:38 PM, outoffocus (23.03) wrote:

Agreed with 100oz. 

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#7) On November 04, 2010 at 8:21 PM, gman444 (28.84) wrote:

Agree with chk999---take a look at a long-term chart of PM's--the volatility is not pretty.  2013, even 2012---way too far out.  If you want to buy and hold PM's pick your favorite stock, mutual fund, etc.  That's my 2 cents.

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#8) On November 04, 2010 at 10:56 PM, HarryCarysGhost (99.70) wrote:

 Somebody pleeeeease tell me why I shouldnt buy the hell out of these before I do it.

I'm going with the Mayan prediction of the end of the world :)

I've been buying the juniors and the precious metal in my hands approach.

All the best  on your calls, the 2012 looks best to me, but I don't trade options so grain O' salt

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#9) On November 05, 2010 at 12:28 AM, Valyooo (99.44) wrote:

I only have $3200.  I dont want to allocate more than 25% to silver.  I own BRF, MTB, and GPRLF.PK.  GPRLF is the one I am considering switching to calls.  The fourth position of mine is either gonna be for trades, or for phillip morris (or an enery stock, most likely PM).  SLW calls seems soooo good though. I am already up like 35% on my great panther

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#10) On November 05, 2010 at 11:44 PM, blackeye101 (51.37) wrote:

Because gold and silver are too popular to be right, for right now.  However, the fundamentals clearly are there (U.S. deficit, dollar collapse, etc.).  What I think happens is a pretty decent correction (not yet of course but within a month)  which might last for a while, until all the people calling gold a bubble say they have been proven right, and then we would see the real move in metals!

 Those same calls can be purchased for a lot less in maybe 6 or 7 months, which if i can restrain myself from buying too soon, is my plan.   I do believe there will be a bubble in the metals eventually, but I don't think we are there yet.

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#11) On December 03, 2010 at 5:54 PM, jrod87 (86.35) wrote:

silver should be at 14 - 1 ratio with gold..right now its 60-1 or close to that figure 60-70 to 1. Historically youed be right to buy silver but you'd be wrong to enter a market that you canot see and clairity and a market were banks like JP and Goldman can supress the market...They can do this and have been doing so for some time now....I would buy Silver bars and coins not calls or etfs..If you caint tuch it its not real when it come to gold and silver...but that may just be me.

 From a buddy of mine-

"Hi everyone!!

> If you can buy some silver do it! the ratio is 60-70oz silver to 1

> oz gold at current market rates. Historically silver has always been

> to 14 to 1 ratio, (14 ounces of silver would buy you one ounce of

> Gold) and soon silver will correct itself back to the 14-1 ratio (over

> $100oz) making silver more expensive. Gold and silver values are not

> representative of current inflation rates either, both of witch are

> grossly devalued, and more importantly silver is being suppressed by

> JP Morgan Chase & HSBC. Both banks are Facing Charges In Manipulating Silver Market Read more:

> http://www.benzinga.com/news/10/11/579017/jp-morgan-chase-hsbc-face-charges-in-manipulating-the-market#ixzz15mC6vgNC.

> Do some research! you will be shocked! Anyways with the Fed's

> monetizing of the debt (aka printing billions of worthless paper) is

> only going to devalue the dollar and push more people to buy Gold and Silver I urge you to trade

> in some of your paper funny money now! for some real physical money (Gold

> or Silver) that for 5,000 years + have always had value and considered

> currency. I am not buying for an investment but as insurance for my

> family when hyper inflation hits, which is soon to come if the Feds

> keep printing money like Zimbabwe did a few years ago and Germany did prior to

> WWII."

 

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#12) On December 03, 2010 at 6:06 PM, 100ozRound (29.38) wrote:

Current silver to gold ration is 48:1

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