The market has been very volatile, I shy away from saying crazy because some folks have been anticipating a correction due to ongoing world debt issues. Whatever your take on the situation I'm wondering how the U.S. debt downgrade will impact the open come Monday morning. I'm almost in all cash except for a few shares of U.S. Steel. I think my plan tonight is to do my due dilligence and research some stocks that I wouldn't mind getting long in.
If the market remains volatile and provides huge swings up/down then doesn't it make sense to take advantage of this market via long straddle? Here is my thought process behind this and someone please comment if they agree/disagree with my consensus. If I enter call/put position on a stock, I know up front what my risk will be and how much I could lose in a worst case scenario. On the flip side, with the huge volatility it may be better than actually getting caught on the wrong side of a trade.
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