Humble
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Everything posted by Humble
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There are dozens of examples when members got better results than me, with some patience. Here are some from the last cycle: BABA - https://steadyoptions.com/forum/topic/2592-discussion-baba-may-2015-trade/:I paid 1.29, many members got it for 1.20 few hours later. LNKD - https://steadyoptions.com/forum/topic/2560-discussion-lnkd-may-2015-trade/:I paid 2.60, many members got it for 2.40 AND exited at better prices than the official exit. FB - https://steadyoptions.com/forum/topic/2559-discussion-fb-april-2015-trade/:I paid 1.10, many members got it at 1.00-1.05. Those are just few examples, there are a lot more.
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They reported today, tomorrow will be too late to buy.
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I guess I could buy it at 0.01 sell at 0.05 and advertise 400% gain.. It's interesting that breakeven points after commissions are 5.80/8.50, so pretty wide range. The problem of course is that even for 1k position, you need 1,000 contracts. and with 1,000 contracts, you spend 1k plus 3k on commissions. But the gain can still be significant. Interesting setup.
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In one of my previous articles, I described a hedge fund manager called Karen the "SuperTrader". She was featured few times by tastytrade as "one of the most successful and fascinating traders". Tom Sosnoff admitted that he "admires" her. What Sosnoff fails to mention time after time is the amount of risk Karen is taking, compared to her returns. This is a critical issue that many traders don't fully understand. To understand the real risk this lady is taking, I would like you to take a look at Victor Niederhoffer. This guy had one of the best track records in the hedge fund industry, compounding 30% gains for 20 years. Yet, he blew up spectacularly in 1997 and 2007. Not once but twice. Click here to view the article
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I would say 3-6.
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I agree. I checked previous cycles, and 3.50-4.00 was the average range a day before earnings. Of course, as we have seen with LNKD and FSLR, past cycles not always repeat themselves.
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Thanks for posting this. I think considering the fact that you are a newbie at options trading AND only 2+ months with SO, you are doing very well. The fact that you beat the official performance in almost half of the trades speaks volume. Most of your underperformance comes from SINA (I hope lesson learned), AMZN and GOOG. As you could see, many long term members entered those trades before I did at better prices. Those who waited, in some cases paid slightly more, but also exited at better prices. They knew that those are among our best names, and even overpaying few cents still leaves you a lot of room for profit. This was not the case with TIF and AZO - next time you will know.
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The rule of thumb is that price of the weekly straddle is more or less how far the price can go without the calendars suffering too much. For PCLN sit about 6-7% last time I looked. If the prices stay below 2.50 by Friday, I might consider it. The spreads are huge, but my impression is that fills are pretty good, sometimes even below the mid.
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The negative gamma is huge for those trades. The IV of short options is already down to normal levels, so it's a pure theta play. I would consider it fairly risky, AAPL tends to move days after earnings, especially if it didn't the first day. Please update us on the results, and thanks for sharing.
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GILD is probably the one to consider next cycle.
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No, I'm looking at prices only.
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Digging through some old forum posts, I came across the following question from one of our members: "My bear call spread is ITM now (RUT 855/865). I adjusted it by rolling it to the next strike (closed 855/865, opened 875/890). But I was wondering if this could be approached differently. This seems too good to be true, so I'm wondering if I'm missing something. I could have done nothing for now, and if on October 18 (when my spread expires) RUT is still above $865, I could just roll to the SAME strike prices for the NEXT MONTH, for even more credit. And keep doing it forever, until RUT is below my short leg and it can be closed for profit or expires worthless. This seems too good to be true, but here's my logic: Click here to view the article
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I think you answered your own question
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Great minds think alike - I just starting to type exactly the same recommendation. I would probably go even with 13 put around 0.18 to reduce the margin requirement to $300.
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We discussed it on the VIX discussion topic. As I mentioned over and over again, this is one of (many) reasons why I believe IB is superior to any other brokers.
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Yes, but TSLA IV is much higher than PCLN - 65% compared to 38%, so TSLA is among stocks that will be more resilient.
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You can see why I'm hesitant to enter this one, especially so early. The stock is at 1250 already.
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Yes, always ATM calendars. This is how Dustin has his charts as well. The reason is that we want to eliminate the impact of the stock move. This is something we cannot control in real life, but for many stocks we trade it will not make significant impact.
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You just look at mid prices, based on the mids of the individual legs. If you have ONE software, you don't have to worry about it, it does the job for you.
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Thanks for sharing. Were you able to get filled anywhere near the mid? My notes show 0.4% for the double calendar which translates to 4.80 or 2.40 per spread. So the prices are good, but as mentioned, this stock can move a LOT, so opening so early is tricky.
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While this is a bit annoying, but last prices are not too relevant anyway. What if the last price from one leg was from an hour ago and from another leg from the previous day? All you should care about is mid prices. As for P/L - no broker gives you good P/L tracking. Personally I'm using ONE software. OptionNET Explorer discounted offer
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Looking at our previous trades, we can see that 0.80 is a good price, but not a screaming buy that justifies entering so early, considering the gamma risk.
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I'm using ONE software. For what you get, I think it's very reasonably priced and provides excellent value for money. OptionNET Explorer discounted offer
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NFLX announced earnings today after the close. Couple hours before the market close, I got a following trade alert from one of options sites I follow: Trade: SELL -1 IRON CONDOR NFLX 100 APR 15 520/522.5/427.5/425 CALL/PUT @.91 LMT [TO OPEN/TO OPEN/TO OPEN/TO OPEN] Trade Explanation: For the Volatility Advisory in NFLX, we are selling the Apr 427.5 puts and 520 calls and buy the Apr 425 puts and 522.5 calls for a net credit of $0.91 to open. Underlying Price: $474.22 Click here to view the article
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Our long term members know that we like to use few non-directional strategies to play earnings. There are few things we like about those strategies: They are predictable. They are repeatable. They are flexible. They can be used on the same stocks cycle after cycle. The following article described few stocks that we use over and over again, cycle after cycle. We said "$TSLA, $LNKD, $NFLX, $GOOG: Thank You, See You Next Cycle".Well, the Next Cycle is already here. Click here to view the article