It may be true that listed options are a somewhat modern oddity. But some quick research has turned up interesting commentary on options trading and, specifically, concerning risks and going short. So William Shakespeare, Edgar Allen Poe and even Ogden Nash added their voices to the unending debate about options trading …
Be wary of the option’s cruelest maze
Enough to know the many risks involved;
Let your good sense prevail amid the craze
Indeed, risk’s puzzle ultimately solved.
Never stop questing in the careful search,
Diligence proudly points the proper way;
Always beware and profit well you may.
Edgar Allen Poe:
Expiration looming nearly
Felt I restless, cold and bleary,
Then consulted experts dearly,
Quoth the maven, “Time decay.”
Sweat profusely, now resigned,
In the money, short and signed,
Note from broker on my mind,
Quoth the maven, “You’re assigned.”
Among the market’s many voices,
What have we? Options? Or merely choices?
Going out in winter in my shorts?
“Not worth the exercise,” he then retorts.
Michael C. Thomsett is an investing and options author and has also written for FT Press’ Agile Investor series, which can be viewed on FTPress.com. Thomsett’s latest FT Press book is Trading with Candlesticks.