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Elected to take my 0.8% hit. Would have liked to buy the long call but P/L wasn't all that attractive so just dismissed all thoughts of revenge on Hexcel and moved on. :D

That’s an interesting summary cnms2. But I’ve decided not to head down that route. In any endeavour, the majority will seek the holy grail of instant success and effortless mastery. It’s human nature. Seeking pleasure, avoiding pain. So while many traders are searching for the...

So you mostly trade credit spreads… I hadn’t actually given them much consideration. To start with I tried a few debit call spreads, with very unexciting results, and resolved to leave spreads for a littler later in the game. Your analysis is interesting and portrays them in a whole new...

Good thing I decided to steer clear then! :D

Through repetition, I want to reach the point where my 1% max loss rule becomes instinctive and inviolable. My work has taught me a lot of lessons, and I've realised the dangers of overconfidence first-hand... Again, I've been conditioned through my job to be clinically detached, but I'm not...

Thanks for all the advice Cache. I take it you're talking about debit spreads. Max profit is the difference in the strikes minus the initial debit, right? I'm curious, how do you structure your spreads, and what does P/L look like prior to expiration? Do you need to hold them til...

No reversal strategy. Welcoming the small loss and looking for the next opportunity. As for stops, I take a long hard look at the chart, but generally, I'm placing them 20 or so cents below support. Given that I'm starting with 80 deltas, by the time there's been a move, it's near enough...

Trying to get into good habits early, playing with my 7K trading account as I drip-feed savings into it. Putting 1% of my equity at risk on each trade, I'd have to mount a pretty impressive losing streak to lose 80%!! Then again, a wipe-out is only a typo away. :D Neoxx P.S. Vig??

Assume the amount risked is a constant percentage of the equity.

When would you consider yourself heavy? How would that influence ROE? Thanks, Neoxx

Oh, I realise that. I'm saving those for when I graduate. ;) Plan to buy LEAPS and sell front-month, preferably overpriced, profiting from vega and theta. Yeah, that's one problem. I was planning to minimise impact of IV and theta by buying ITM options with reasonable intrinsic value...

One of the reasons I moved over to IB was their great comissions. 75 cents per option contract. Like a mosquito taking a bite of your cake. :)

Hi, Thanks for all the advice. Much appreciated. I started out with mostly ATM calls, and learnt the effects of theta and vega the hard way. Fortunately, I started with a paltry-sized account and practiced good risk management so my lessons were cheap. The reason I've decided to go...

Working in a litigious industry, and having witnessed some spectacular mistakes, I'm a keen proponent of risk management. So although I'm new to trading, it feels natural to extend the concepts. Being a swing trader out of necessity - working long hours (GMT) and with other commitments -...

Just fielding a few quick questions... Does anyone have personal experience with mentoring as applied to trading? (AKA Napoleon Hill's Mastermind) Are there any retail investors here who have mentored with seasoned pros? Are there any professionals who have tried their hand at...

I realise the internet's not the most reliable source for information but I read this on www.thepitmaster.com Hopefully I'll understand what this means after I've read Baird's book- :D

How should you guage the value, and how can you find underpriced options?

In your experience, what have you found to be the most effective way of finding underpriced options? How reliable is comparing current implied volatility to mean historical volatility? Thanks, Neoxx

I posted under the impression that this was a site frequented by experienced and knowledgeable traders. I still believe that is the case. To this end, I was simply asking for some informed opinions on a hypothetical scenario And I realise there is no concrete, absolute answer. I was...

1.5% is well beyond my capabilities. I'm not a sophisticated investor by any stretch. In fact, I'm barely out of the starting blocks. My risk management is as complex as being selective in stock selection, being a net option buyer and limiting my maximum downside loss to 1% of my...