The time element is crucial to my deep-in-the-money call options-picking system. With Tuesday's win on Cameron International ( CAM), my system -- which you can follow through my Nails on the Numbers newsletter -- has a win rate of 96-1.

I'm very proud of that record, which should cross the 100-win finish line in the next month or two, depending upon market behavior.

Nails on the Numbers

Time allows me to adjust a position to market conditions. My picks are not set-it-and-forget-it investments. If a pick's underlying price goes down, I must adjust through re-buys at lower prices.

By adding to my position, I lower the average price per contract. This repositions me for a better chance at a win. It helped with my Jan. 6 win on Corning ( GLW), which was a $7.50 call option that stayed in play for 62 days before paying out $5,800.

During that time, we added 50 contracts to the initial 10 -- building on our position but lowering our average cost. We had until January 2011 to close out the Corning call. But in a recession, we want as much cushion as possible against an extended bear market. We're all waiting for that bottom.

The same Corning position we've already closed on is now going for $5.45 at the mid-point -- more than $1 above my average cost per share on those 60 contracts. But in a volatile market, we pay more for that extra year of cushion: The January 2010 $7.50 call position is going today for $4.80. So in choosing my position, I balance higher cost against the safety cushion of more time.

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