Risk, Leverage, Diversification

My July 125 put is now less than 30 days away from expiration. I can see how an investor could be tricked into being overly comfortable as days and weeks go by in a leveraged position with nothing going wrong. The first day I sold the 140 Oct '09 put I was very nervous at being obligated to put up so much money towards AAPL. On that first day I could barely go an entire lunch without looking at AAPL's ticker. Now, I could go the whole day. However, the price of my 125 option has barely changed in those 2 weeks, why am I so much more comfortable?

I can see how investors (or should I say speculators) are lulled into a false sense of safety.

I would like to address why my portfolio is not more diversified. For one, I believe that asset classes such as US equities are much more tightly correlated than most believe. Second, I hate paying commissions. A $2.95 option commission for a $1,000 profit keeps my commissions expense ratio low (0.3%). Third, I don't have enough capital to be in more than a few companies. There are many companies I would like to own shares of long, although in this environment I would probably only consider a hedged pair trade.

Possible pair trades that pop into my mind are long Under Armour, short Dicks Sporting Goods or Long Chipotle, short PF Changs.