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Hey, don't take it out on me! I've been the one PM-ing you all of the correct info to post :) I gave up 3 pages ago. Kinda reminded me of my days of arguing with a monkey (pre hallucinogenic usage) :)

LOL. Nice edit :)

You're always so concerned with details :)

If you really want to clean up on an Intel move to 90 in/by January, load up on Jan 35 calls for 2 cts or Jan 30 calls for a nickel. However, you could have a problem if the move occurs in Jan but after expiration. That would force you into something more realistic in Apr where the highest...

Are you a poor factory worker who successfully took ET's overnight ESOL crash course? Your broken English and staccato grammar have improved unbelieveably! If I didn't know better, I'd bet that we were discussing risk free trading! And FWIW, the numbers that you tossed out gave nearly...

It's an in house contest to see which trading desk can generate the most volume! :)

Well of course you should! OI increases in a bull market! Everyone knows that. When a new option series is added during a bear market, OI starts at zero and declines to negative numbers. That means everyone is selling!!!! :D and a (wink)

Why would someone buy at 1.50 when the ask is 1? Bad orders occur. SHIFT happens on a lot of keyboards. Dumb money is a gift to traders. What will happen in such circumstances? Everyone in range will pounce on the order and fill it. Nothing earth shaking will occur. IV won't change...

I disagree. If you wish to prove your point, present numbers which anyone here can verify or refute. Language will be no barrier. Pick a stock and a strike price as well as an IV. Calculate the fair value prices of each leg of the ITM and OTM calendars. Determine the net cost... which...

Was this trade executed in the morning or in the afternoon??? :)

You can hypothesize any number of scenarios but if the options are fairly priced from the same volatility number (albeit higher or lower), there's no difference if the underlying rises or falls, time elapses or people write with their left hand. Here's crazy one for you. A call is .90 by...

When you understand synthetic equivalence., you'll grasp that if two strategies are equivalent, they'll yield the same results. Since these two calendars are equivalent, it doesn't matter if the underlying goes up or down. The result will be the same. Once you actively adjust these...

The principal is the principle ! :)

They're the same. An easy way to see this is to model the positions. Buy the OTM calendar and sell the ITM calendar. Use fair prices. The graph over time and price will be a straight line at ZERO indicating that there's no potential gain or loss. That means that the positions are...

So today you believe/know that the underlying will be down for a month to the strike by September expiration and then up after expiration? Impressive! I'm with MTE in that both calendars are bearish and when you cover the short leg (or it expires), it becomes a new trade. In addition...

Not true. With a calendar you are looking for expiration at/near the strike. After the near term leg is covered cheaply or expires, then you want the directional move. Any sizeable directional move in either direction that heads OTM is NOT good for calendars.

Sure it's reasonable safe because for the near term, an ITM calendar won't make or lose you very much.

When you say SELL to close instead of BUY to close, it's not semantics. Brokers have the right to have more stringent rules and requirements than the law permits. I'd check the fine print in your account agreement to see if that's the case with Ameritrade. If so, deal with it or go elsewhere.

Post some real time prices from today (stock and option you're considering) and then pick a lower price after the rocket scientist short sellers do their thing. Calculate who made and lost what. Then, you can have a realistic discussion.

Not only does the market not know but sometimes the investor has no clue either :)