In this clip from today’s edition of The Macro Show, Hedgeye CEO Keith McCullough breaks down how he purchases call options, with respect to the Hedgeye Trade/Trend/Tail risk management process.

“Tail ideas are long term, and a lot of our power users will buy out-of-the-money call options a few months out based on the tail,” explains McCullough, while he explains the different ways to use call options to augment positions.

McCullough: How to Use Call Options - risk ranges