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Oh spin btw I am becoming a bigger fan of ITM calls vs straight ownership :)

Ah I see. I should probably try to keep it more simple. Hi spin what I meant was say you bought a stock at 6 and sold lets say the 9calls to buy 7calls if the 9s where called away you make 3$ on selling the stock and your up another 2$ on the 7calls which you can exercise or sell. Make...

If it goes down then you are down, but if you just flat out owned the shares you would be down too.

Hi dagnyt, No that is fine I am just exploring ideas, reading alot :). What I was thinking is that say I owned a stock that was in the money and I didn't feel was going to make a huge move, but could creep a little higher. Wouldn't be a good strat to sell further OTM covered calls and buy...

Thanks spin and atticus Yes that is what I was trying to describe. Yes it was a directional play, not a vol play. Droid

Hi atticus, I didn't mean to open a can of worms :) I was asking if in general it was a good strat to use that combination. Basically I was looking to have the benefits of the RR (the unlimited long potential) with a max predefined risk. Thus selling a bull put credit and using that to...

Hi atticus, Could you explain what a "gamma tree" is? I understand at least in theory what gamma is and how gamma scalping is used to stay delta neutral, but I have not came across gamma tree yet. Thanks, Droid

Hi all :) Just looking at what your thoughts are on this one. Basically creating a ratio spread by selling covered calls instead of selling naked calls. Seems like a good move if you don't think there will be too big of a move, but if it was you would sell your shares for a profit, and be...

Thanks for the thoughts so far all. This was all thinking out loud and hasn't been applied to anything specific yet. I was just trying to look at the advantages of and disadvantages of this type of move. I originally like it because as a net/bullish strat as the full risk was defined and...

Hi all :) What do you guys thinks of selling a vertical put credit spread and using the credit to buy a long call. Kinda like vertical put credit spread risk rev combo? I am looking into this because it gives unlimited upside potential with a limited risk and in some cases able to even...

Nice thanks for the responses :) So I was looking at the bid ask spread concern, and see what you guys are talking about in particular with the deep far out ones. So what is the best way to get a decent price? I am assuming market orders are a no go. Just put a limit in and hope...

Nice thanks all :)

Hi all :) I have been reading a book about buying deep ITM calls as an alternative to buying the stock. Basically It suggests buying as deep as you can with a delta over 90%. The author argues that you are getting the same benefit of owning the stock with about half the cost. My...

Thanks Dave, I will check it out. heiasafari I was thinking more about your strategy. It cuts your lose to a giving amount in this case 2%, but doesn't it Cause you to bail early sometimes? For example if you sell a spread with a 80% expected success of finishing above the sold option...

Nice thanks heiasafari :) I like your example. So for your set loss trigger do you execute a market buy back of the spread if the trigger is tripped? Thanks, Droid

Hi all :), I am looking to get your opinions on general bankroll management you guys use. In particular I am interested in selling credit spreads. I have found some suggestion using 2% of your capital on a single trade. That sounds safe, but If I wanted to invest something like 200K I...

Thanks Mark, So as long as I close the spread before exp then I only have to worry about the strike price diff x 100 per contract, right?

Hi all :) I have a few questions about vertical credit spreads. I am using Ameritrade and it looks like I can sell a bull put spread in one transaction setting the net credit limit to what I want. I am guessing I can close this same spread by setting the debit limit when I want to close...

I sold the 2011 5ps and bought the 7.50 calls as I originally planned. I sold a few more then I bought so the trade was about even. We will see how it goes? Oil broke 80 :) Thanks for all the opinions. Droid

I just thought DRYS is taking an unique position by moving into drill ships at the time they did. I feel GE will look like a genius is this gamble pays off.