Random comments

Leverage giveth, and leverage taketh away. You lose a lot of money very rapidly if the stock goes down instead of up.

So it's a very profitable approach sometimes, but only if you can identify stocks that you are really darned sure will be higher in price a couple/few years down the road. Since that is usually based on an assessment of value and its trajectory, it has to be a stock for which you feel you have a pretty good handle on how to value it. I generally assume that I might have to wait up to four years for a value thesis to work out...two rounds of two-year calls. If you're goign to use a strategy that might take that long, you should make sure you have the personality required for that kind of trade. You might look like a stubborn idiot for three of those four years, which is fine, as long as you don't panic and sell before the investment works out.

Buying puts for protection is a fairly expensive way to get around a lack of certainty...you are losing time value on the calls you're buying, and you're losing time value on the puts you're buying.

A whole lot of good stocks are quite richly priced at the moment, or at least more richly than usual. I have some in the money calls against Hershey, which I think will do nicely if the current rough patch for their business ends and their usual valuation range is seen again. I like DG too, though I seem to be pretty much alone in that regard : ) ---see comments above about having to wait a few years sometimes.

Jim