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Arbitrage is for the big players. They trade in huge size and are willing to take very small profits per 100 shares. Your commissions are far too high to participate in that arbitrage. Leave this game to the professionals. Mark

1) Using stop-loss orders with options is a big mistake. 2) A sudden change in the implied volatility can make a substantial difference in the price of an option - and yes, even when the delta was 80 (it's going to be less whens topped out). You do not want to get stopped out of a trade due...

You cannot determine 'safe' by past performance. Risk must be estimated before the trade is placed. Mark

Write and sell are equivalent terms. Write simply refers to 'writing an option contract.' The term is most commonly used by a stockholder who wants to become a covered call writer. Any time you sell an option 'to open' or to go short, you are writing (increasing the open interest - unless...

More than a brain fart. Careless. Thanks for the correction. Mark

Collar: Long 100 shares Long one call Short one put Options DO NOT have same expiration and strike. see link for more details Mark http://tinyurl.com/lwxo4x

You just learned of this strategy today? You have no experience using it? You have no track record? Yet you propose that someone else trade this strateg? Do have the slightest idea how difficult it is for a retail customer to trade backspreads? No, of couse not. It's very...

Question: Do you know what you are trading? These are NOT options on the VIX index. These are options on VIX futures. They are also European style options and it's possible for the calls to trade under parity. This is not your typical option. As long as the markets are liquid...

Unless you want to sell calendar spreads, most of your negative vega positions are the result of being short some options. Sadly, that means negative gamma. Mark

Agreeing with jwc: 1) It's not quite right to assume the market must move 700 or 1200 points in 48 days. Think how much you would lose if the market moved half that amount in one week. Or three quarters of that amount in two weeks. 2) What do you do then? Do you tell yourself there are...

When they <b>already</b> own stock, they cannot hedge by buying calls. They must sell calls or buy puts to hedge. Mark

The numbers are not the issue (right now). Here is what you are missing, and take my word for it, if you don't understand the following, you will NEVER earn money by trading iron condors. NEVER. What you are missing: 1) 'I don't see how I can lose' That is an unbelievable statement...

1) You can always sell your option - unless it is so worthless that there are no bids. 2) Yes, you can close your put (by selling) at any time - as long as it is before expiration 3) DO NOT EXERCISE. The reasons can get complicated, but as an individual investor, it's likely you will go...

Trust you? You have no idea how to use option terminology correctly. The term 'in the money' has absolutely NOTHING to do with the your profit or loss. It has nothing to do with the premium you collected when selling the option. The term in the money - for a call option - equals...

I thought it saved them automatically. Quickest way to get answer is to call tech support. Mark

I believe most traders would have better results if they ignored B/E. Once you own a position, it's your job to manage risk and exit the position at an appropriate time. That exit point depends on risk/reward, probability of earning money if you hold etc. But the one thing that does not...

You are letting yourself get confused over simple situations. The BE is not relevant. The option owner - the person who has the right to exercise - may care about his BE, but it does not have any influence on the exercise/do not exercise decision. The chances of being assigned prior to...

It's jibberish. Stocks do not get pinned - but normal distribution tells you that some stocks MUST end trading at the strike price. When MMs own the strike, they trade their gamma. Thus, they sell above the strike, drive the stock lower. They buy below the strike, driving the price...

This seems right to me. In a world where anything ca happen, refusing to cover short options when they are available for 5 cents is a huge mistake. Also: if a speculator wants to pay a nickel for some of those options, what's wrong with that? It's better than selling them for a nickel...

IB will NOT close it out for you. IB has nothing to do with the process. The OCC will issue an exercise notice. Your account will be assigned that exercise notice. As a result, you sell 100 shares of stock and receive the strike price per share. You do not have to wait until...