DJIA

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Don't those numbers disturb you a bit though: 126% "recovery"?

Not really. It all depends on the sector and the individual stocks. For example, some of the banks dropped 90% from the high, as the shorts speculated they would going out of business. Since that didn't happen, a run of 100%, 200%, even 300% isn't unreasonable, and still leaves the stocks massively off their highs.

Then there are stocks like AAPL. It's earning more now than it was a year ago, and with even better to come - why shouldn't it be at a 52-week high? Same for EMC, VISA, McDonalds, Celgene, AmGen, Gilead, First Solar, etc.

And emerging markets are coming of the recession a lot faster than the US, especially with rising commodity costs, so it makes sense for them to outperform.

From a technical perspecitive, the recovery's come so fast there's bound to be some kind of consolidation/breather period for the market/stocks to find a secondary support to feb/mar, wether that be the 07 high or somewhere inbetween...

I don't disagree, but how on earth do you time such a thing? Plenty of people have tried and lost a lot of money doing so over the last few weeks. I screwed up myself shorting AIG.

I've hedged a few of my positions, well worth the $$$ in Puts on my longs...BIDU, AAPL, PCLN, FSLR, CME, ISRG.

I've looked into that, but never actually done it. How far out do your puts go, and how close to in the money? For example, if you were buying a put today on 100 shares of AAPL, what would you buy? An October $185 put for $105+fees?

If I was buying a PUT today on AAPL, I wouldn't be looking at a Long Put position, I'd have a price target of around the $177 area (Gap), max, w/ testing of 184 ish... which isn't a huge retracement.. leading me to buy a Nov. Option w/ a higher Delta (.8+: for each $ the stock moves, I'll get the Delta in return, so .80 cents), typically 2-3 strike prices ITM.

So, for me, this would look like a 200 or 210 Option. The difference is quite big in price: 200 is about 14.85 w/ a delta of .63, whereas 210 is 22.18 but has a delta of .776. One will have a higher ROI but the other will make you more money.

Give yourself enough time, options expire 3rd fri (sat @ noon) of every month... aapl's been pounding that 187 mark for 13 days before breaking it, and even then, it's been tossing spinning tops and doji's... so, it might take a bit to break through it again and you wouldn't want your hedged position to fold due to time.

OTM options, I've only used for Spreads (Credit Spreads, not Debit (i don't have that trading level yet)).

If you were long on aapl and wanted less risk and just to get into a hedge position, you could do an OTM option like the one you posted... it had a delta of .38, but was extremely cheap...costing 6.73... bu tyou're only making 38 cents to the dollar move... if it tanks, then it'll eventually get up to that .9+ delta and go $ 4 $, and you've dollar cost averaged down on your long position.

The difference is the value you buy in the option and how long you think it'll take to get to that price target.