Dykstra: How the Mighty Have Fallen

Updated from 7:54 a.m. EST

It's starting to get pretty bloody out there. Volatility and uncertainty persist and investors are struggling with what to buy and what to sell. Numerous great companies -- General Electric , Intel (INTC) and Bank of America (BAC), just to name a few -- either flirted with their 52-week lows or established new ones in the past week.

The present situation provides terrific opportunities to ultimately benefit from proper utilization of the winning strategy I espouse each week. Deep in-the-money calls give investors the ability to lock in prices and control much more stock for several months at a time (if needed). Therefore, when stock prices dip or establish new lows, locking in these bargain prices make deep in-the-money calls even more attractive.

Although there's a multitude of companies I could highlight, it is important to note that regardless of the prevailing stock or stock price, deep-in-the-money calls make it far easier to participate.

Chevron (CVX) provides a perfect example of why a good-till-cancel (GTC) limit order of a quality company is so important when your investment strategy focuses on deep in-the-money calls. Less than four days ago, Chevron closed just below $61. On Friday's weakness, I was able to cherry-pick 10 (CVXFJ) deep-in-the-money calls, with the strike price at $50, going all the way out until the third Friday in June, for $8,600.

The symbol in parenthesis is what identifies our particular option. The common stock symbol is always first. The letter "F" stands for the month -- June is the sixth month of the year, and F is the sixth letter in the alphabet. The letter "J" is the strike price. The code for the strike prices works the same way as the month, by the alphabet. Every letter is 5 points apart. J is the tenth letter of the alphabet, so in this case we are buying the Chevron June $50 strike, which is: (CVXFJ).