Buy and Hold or Buy and Hedge – Which Do You Prefer? | OptionsANIMAL

Buy and Hold or Buy and Hedge – Which Do You Prefer?

I heard something on CNBC yesterday morning that compelled me to write this blog today. Steve Ratner, former U.S. Treasury Auto Advisor, was part of a panel reviewing the hype/excitement over the Facebook IPO. Steve is quoted during this interview as saying, “Individual investors shouldn’t be playing the stock market any more than you should take out your own appendix”.

The old hedge
The old hedge (Photo credit: Wikipedia)

He went on to explain that he feels that we as investors are unable to take information about the companies we wish to invest in, do thorough analysis and come to a reasonable expectation for share performance going forward. He feels that investors should be in market index funds only.

Really?!! I was astounded and dismayed at Mr. Ratner’s patronizing dismissal of an entire community of stock market investors. We know the returns on index funds over the past ten years have been less than stellar. Ten years ago, shares of the SPY, the ETF that tracks movement of the S&P 500 index, were trading at just under $110/share. Today, these same shares are $136.19/share representing an absolute return of 26% – just 2.6% per year. To say that we as the “small guys” in the market could not have outperformed this metric by finding excellent buying opportunities is ludicrous. What if, as an individual investor, I had purchased shares of Apple (AAPL) ten years ago at $10/share and held them through the crisis and rebound in the market? AAPL is trading at just over $570/share, representing a 10 year return of 5600%. How about Starbucks (SBUX) over the same time period? I could have purchased shares 10 years ago at around $11/share. Trading today at $55, that represents a 400% return or 40%/year. Just a little better?!!

The real question is whether we as investors would have the “stomach” to hang onto those shares during the 2008/2009 time frame when it appeared that we were in a financial armageddon in our markets. If we were fortunate enough to be graduates of the Options Animal program, we would not have needed inordinate bravery to withstand that time frame. Our knowledge of utilizing options to protect our investment in those shares, as well as ways to profit from that selloff, would have enabled us to hang on and reap the rewards that have followed.

Perhaps Mr. Ratner is correct about a long-term “buy and hold” strategy in many equities. I know that he is definitely wrong if the individual investor understands a “buy and hedge” strategy. Thanks to OptionsANIMAL, I am proving Mr. Ratner wrong on a daily basis – and loving it!

Karen Smith
OptionsANIMAL Instructor 

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Options Animal – A Solid Investment for the Right Person If you're seriously thinking about joining Options Animal, here’s what I’ve found to be true from my own experience. First off, this isn’t for everyone — and I mean that in a good way. Options Animal attracts a unique kind of member: curious, serious about financial education, and committed to growth. The membership tends to be smart, experienced, and inquiring. The community is intelligent, well-educated, and experienced, but also welcoming and supportive. People are friendly, down-to-earth, and genuinely interested in helping each other grow. If that sounds like your kind of group, you’ll probably feel right at home. That said, this program is best suited for investors who are ready to put in the time. The program expects you to study, apply what you learn, and take a hard look at how you're doing, you’ll find tremendous value here. There’s meaningful homework. There’s a process. But if you’re committed, it really does pay off. Discipline is also key. The instructors provide a clear, structured approach. When I deviated from that structure, I felt the consequences — but also gained important insight. Mistakes become learning opportunities here, and that’s part of what makes the experience so worthwhile. One of the big strengths of OA is how they teach you to be flexible. They teach you to adapt to market conditions, not just follow a static strategy. It’s clear they live by this principle, and their teaching reflects that. Most importantly, you’re never on your own. The team at Options Animal is always available, approachable, and incredibly generous with their time and expertise. Whether you're asking questions, learning from live sessions, or following along with real trade recommendations, you’ll feel supported every step of the way. Each instructor brings a different perspective, which allows you to find an approach that matches your style and goals. Now, about the cost: if you're thinking of it as an expense, it might not feel worth it. But if you see it as an investment in your financial future, it makes a lot more sense. You're paying for education, structure, and guidance that can really make a difference. You don’t need a huge portfolio either — the strategies can scale. A perspective regarding returns (ROI), the payoff improves with time. As your skills and confidence grow, so does your ability to generate solid returns. For me, this has absolutely been a smart investment — one that continues to pay dividends both financially and in terms of personal growth. For the right individual, Options Animal is more than just a program — it’s a powerful, ongoing advantage being a really solid investment — in every sense of the word.
Response from the owner:Thank you for sharing your detailed and insightful experience with Options Animal. We're thrilled to hear that you found value in our community, structure, and instructional approach. Your emphasis on discipline and adaptability perfectly captures what we strive to teach our members. It’s rewarding to know you see your involvement as an investment in your financial future and personal growth. We appreciate your feedback and support!
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4 years ago
How The Animals Play the Game Options options endless bucks Sounds so good but now I'm stuck Terms confusing, where to start The OA coaches do it smart Build your option with a plan Balance risk reward and chance Then like SEALS on secret missions Plan your exits with precision And if by chance you plan goes sour You exits have a secret power Adjust it for your profits claim The only way to play the game - Bob the budding options guy
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